Management of international business Essay Example | Topics and Well Written Essays - 4000 words

Management of international business - Essay Example Nevertheless, its home country government encourages expansion and the host country business environment is conducive to FDI. The repost that suggests the CHL should enter Belgium through acquisition of majority stake in an existing mobile network operator’s business. Based on the Uppsala Model, once it has gained knowledge and expertise on the local market, CHL can expand its network and make further investments. Table of Contents 1. Introduction 1 2. Belgium 1 3. The European Union 4 4. China Mobile Limited 6 5. Telecom Sector Analysis 9 6. Mode of Entry Analysis 11 7. Conclusion 15 References 16 1. Introduction China Mobile Limited, world’s largest mobile operator, intends expanding overseas into the European markets. It intends to enter the Belgian market which is under the European Union. This report evaluates the telecom sector in Belgium apart from the business environment in Belgium and then suggests the mode of entry. 2. Belgium Belgium has always been a prospe rous market place and is located at the crossroads of Latin, Germanic and Anglo-Saxon influences (Belgian Federal Government, 2011). This is a small country but it has highly competitive industry and service sector, and is well integrated into the globalized world. According to the KOF index Belgium is the most globalized county in the world. The nation also occupies the sixth position on the list of the countries that attract foreign investments, as per the Ernst & Young European Investment Monitor, 2011. 2.1 Political Environment The Belgium state has evolved from a highly centralized structure to a federal system in which many regions have been granted autonomy for many policy areas (Rynck, 2005). Each region is responsible for its own economic development, housing, environment and transport. In Belgium there is no hierarchy between regional and national laws. Political risk in Belgium is very low in Belgium, according to AMB Country Risk Report (2012). 2.2 Economic Environment T he country was affected severely by the recent global recession. Countries that have so far been investing in Belgium are the United States, the United Kingdom, France, Germany and the Netherlands (Belgian Federal Government, 2011). Investments are mostly in sales and marketing sectors followed by industries and the logistics sectors. The business environment in Belgium is conducive to investments as there is no distinction between foreign and domestic companies. There are no restrictions either on foreign investments or income repatriation. In addition, foreign companies, subsidiaries or branches have the same privileges, and enjoy the same incentives as domestic companies while they also have the same legal obligations (UHY, 2011). Because of the locational advantages Belgium has become a highly developed transit and distribution centre for several other countries in the European market. The banking system is under the control of the Belgian National Bank, which is responsible for all monetary and financial operations in the country. Venture capital is also available to young and dynamic entrepreneurs (UHY, 2011). Belgium has a well-developed economy and all the economic sectors are well represented. However, it imports almost all raw materials but exports from the country are primarily comprised of machinery and transport equipment, food products, chemicals and metals. The two main regions in Belgium are Flemish and Walloons but the unemployment pattern in