International Investment Report Research Paper Example | Topics and Well Written Essays - 1250 words

International Investment Report - Research Paper showcaseChina is the largest country among the four emerging economies of the world and other three countries include Brazil, Russia, and India. It is the fastest addition economy among all these four countries. Data for 2011shows growth rate of China has outpaced peers with sharp contrast in GDP, merchandise export and GDP average growth rate as shown in the image to a lower place China is expected to maintain the growth momentum and outpacing its peers even G7 countries over years in futurity for many reasons with increase in middle tell apart being among the leading ones. Rising middle class refers to increase in income bracket of large number of people. This trend has a constant positive growth projection to year 2050 as shown in the image below hence, it can be predicted that there would be increasing opportunities of investment in China. To mention, the worlds largest coffee tree shop Starbuck has also planned to embellis h in the more 70 smaller cities of the country (Bloomberg, 2012). This report analyzes China as an investment prospect for a coffee house and for this purpose the report will analyze the macroeconomic factors that could influence the demarcation in the country. The report discusses about the economic, pecuniary, political factors along with historical events that could impact the business and its geographic status that could influence the business in the country. At the end, the report analyzes the overall jeopardizes that businesses could face while starting a business in China. (Global Sherpa, 2011) (Global Sherpa, 2011) ECONOMIC STRUCTURE, INDICATORS AND RISK ... This slowdown has been controlled by the targeted stimulus. For instance, construction of 36 million tender housing units, support for SMEs in Wenzhou, bonuses cut down in the automotive sector, and subsidies on purchase of family unit electrical appliances and so on All these factors have supported the economic situation despite having troubles with export (Coface, 2010). pecuniary STRUCTURE, INDICATORS AND RISK Financial factors other important influence the businesses. Risk rating for the country is as follows (Coface, 2010) However, access code to finance for SME is difficult as banks are reluctant due to string of defaults as the main risk. similarly overall strict policies have been imposed on banks for credit giving to avoid misallocation of resources etc (Coface, 2010). The overall financial figures are positive as investment in the country has increased, poverty level has decreased etc. The coffee shop market is expected to grow by 55 percent and it would reach to 4.5 one thousand million Yuan ($714 million) in 2015 from 2.9 billion Yuan last year in 2011. To share this benefit, global coffee competitors such as Starbucks of US and Luigi Lavazza Spa, an Italian coffee company have entered and planned expansion in major and minor cities of China (Bloomberg, 2012). POLITICAL STRU CTURE AND RISK China has been mainly a collectivized country. However, the country has accepted the capitalism mode of economy but socialism is still what it breathes. The political risk refers to intervention of countrys government in the business affairs of the foreign person or a company that is doing business in the country. China is usually accounted for this political risk and its government has already once considered the nationalization of industries in 1949 (China Risk Management, n.d.).