Country Risk and Strategic Planning Analysis

Essay by shanbanana April 2007

download word file, 7 pages 3.3

Many companies are looking to expand their markets from one country to another. In order for a company to become successful at implementing a new product or service into another country the company must first do an analysis of all the risks involved in the chosen area and develop a strategic plan that will work for all parties involved. This paper will analyze the risks involved in implementing mining conveyers into the country of Chile.

Political, Legal, and Regulatory RisksThe government of Chile welcomes foreign investors into the country and even promotes foreign and domestic competition. Chile also is willing to lift trade barriers for foreign investors to enter the country. According to TMC (2007), "intellectual and private property rights are guaranteed and protected by law, though enforcement can be slow and expensive" (p. 1). These laws have become stricter over time and the apprehension and obliteration of phony goods is usual.

The country has passed a law to protect products and services that are considered registered trademarks and patents against piracy.

Competitive Risk AssessmentAccording to the Viewswire (2007), "Chile's competition rules, which basically prohibit any act or agreement that prevents free competition within the country, are listed in Law 12,205 of 1959" (p. 1). This law helped to establish a group called the National Economic Prosecutor or Fiscalía Nacional Económica (FNE) (p. 1). FNE has the power to look into and indict those organizations that are in violation of the law.

The country deems such things as price-fixing, and obstructing the free competition in labor markets illegal. The company also scrutinizes foreign trade when the foreign trade directly influences the internal market of the country. In 2003, a law was passed that created an independent court known as the Free-Competition Defense Tribunal (TDLC), which helps to prevent a...