A: The global economy and the digital era have reshaped business opportunities, whether they be educational, financial, or in networking and building organizations from the ground up. Now you can run a business in a foreign country remotely, or with the help of people you rarely if ever see in person. Given the disparate regulatory (and deregulatory) policies of countries around the world, and the access to different markets they allow, it behooves business leaders to carefully consider what destination is most business friendly. International business involves lots of moving parts, and must work within different confines while taking advantage of opportunities that are tricky to suss out. Countries do many things to attract international investment, and not all of them are beneficial to the countries, or the international community.
International Business Destinations might not be where you’d expect. Take Alabama for example. In 2014, over $1 billion in direct foreign investment was pumped into the state, and it saw a 115% increase in exports between 2004 and 2014. At a time when American manufacturing struggled across the country, Alabama’s automotive manufacturing industry flourished through foreign investments from Mercedes-Benz, Hyundai, Honda and Airbus. In 2012 it set production records, and has a strong supplier infrastructure, respected training programs, wide and efficient transportation network and continued success with top auto manufacturers. It also has a low corporate tax rate in comparison with many other states. Other key exports from Alabama now include industrial machines, minerals, iron and steel, plastics, chemicals, and aircraft and aircraft parts.
One way countries attract global business is through their corporate tax rates, which fluctuate massively throughout the world. It might seem logical to offer lower corporate tax rates to be business friendly, and many countries do so. In December 2016, CNN wrote about work Oxfam researchers did studying the Netherlands, Switzerland, Singapore, Luxembourg, Bermuda, Cayman Islands and Ireland’s corporate tax rates, and the damage they do to the international community. By keeping corporate taxes so low, Oxfam found these countries were “starving countries out of billions of dollars needed to tackle poverty and inequality.” They found the cuts in corporate tax resulted in massive cuts to public spending, or taxing poorer people. However, the strategy worked, with Oxfam saying 90% of the world’s biggest companies were involved in at least one tax haven. Sometimes, larger regulatory bodies force international destinations that would like to be business friendly to go against their wishes. Ireland was recently ordered by the European Union to recover €13 billion in unpaid taxes from Apple. Companies have also been targeted more directly, like Starbucks, which was told to pay back €30 million it avoided paying in taxes due to a deal with the Netherlands. Countries also incentivize international business investment and production through cutting safety regulations, workers rights and other restrictions that prevent multinational businesses from making maximum profit.
The international communications technology explosion has lowered delivery costs and allowed instantaneous access to far larger consumer pools much the way transportation developments lowered costs in the previous two centuries. Arranging business processes across borders with ease has made many international destinations appealing, strictly by being emerging, untapped markets for products that can reach them with remote cooperation and minimum cost. Now a country can enter existing supply chains that want their participation instead of building them in order to attract interest and investment from global businesses.
To get a better understanding of global business, you might consider an International MBA or Global MBA. International and Global MBAs are MBA programs that focus on international political economies, foreign languages and culture through a diverse student body and course materials that prepare students for multinational business ventures. They also often take place in other countries, or on multiple campuses across continents, to give students real world experience with fluctuating regulations, business practices and cultures to prepare them to wreak havoc on the market once they graduate. Some IMBA programs require students to participate in one or two international experiences. Classes in Global MBA and International MBA programs often include financial management analysis, financial accounting, marketing for international managers and international economy and business. These programs prepare students to work in education, government, finance and multinational corporations, and focus on giving them the tools they’d need to do so wherever they please. International MBA programs are often less expensive than traditional American MBAs, and can take only one year as opposed to the American standard of two. Here’s a list of top International Business Schools to help start your search. It prizes schools that develop graduates for careers in global sales, marketing, and financial management, ranking programs based on their unique features and affordability.