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Incentives:

There are different aspects of providing incentives to motivate their workers, employees, public and for their own benefits. There are many countries which try to reduce their own potential risk of promoting their products, brands or advertising its products in different markets. Therefore, many countries try to reduce perceived risk of advertising or promoting inward investment as they are not tied with sharing, during the condition of tax breaks, free posts, free trade zones etc. this type of barriers affects the countries economy, as for example government tries to attract mobile investor, or considering the scheme for poor local skills which might be withdrawn once capital has been accumulated. It is same in the case of incentives which depend on feasibility of incentives compared to real return on investment?

Assessing political vulnerability

There are political aspects of economy, which create helplessness for the host and home countries business and its growth. Following are some the crucial aspects which we found out are the main features to make the company’s profit or loss in host country. Even Chinese economy could not deny to these aspects:

For a new MNE’s entering in to any new market, needs to create good relations with its legal, political, CSR and environmental aspects, as in case of its own home country.

The products should be good in quality, sensible to consumers, and trustworthy relationship with customers & industry.

Company needs to keep in mind the area and location of it growth. In order to reduce miscommunication, code of conduct, health and safety and good operating services.

Promotions of the products, brands and services are much more important for success. Therefore, visibility of the firm is must, in a way advertising the products in host country gives huge public entrance with competitors.

As we have discussed different political and legal aspect of host country’s in order to work out strategy accordingly.

Contribution to the host country, that means, giving charity, investing in shares or stocks, merging, partnerships, joint ventures, providing employment, good salaries to employees, motivation, incentives, and pensions to the current workers and so on, it is important to bring up a good goodwill in host country.

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