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Trade Impediments

This paper analyzes policies for doing business in alternate cultural settings. Identifies some of the major impediments that may limit the ability to "truck, barter and exchange across international borders. Discusses impact of culture and national ideologies.

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Introduction The president of General Motors once remarked that the business ofAmerica is business Although there are political and ideologicalmotivations behind that statement that can be criticized the essentialidea behind the statement is true In fact the statement could be morebroadly applied beyond the United States Adam Smith the father of moderncapitalism believed that it was natural for all humans regardless ofnationality to truck barter and exchange Although this may be anatural human inclination as in all things human there are some

Human nature is to get itsbusiness done, whatever the impediment. In many ways, it is remarkable that any business is conducted on aninternational scale. (1984). Cultural impedimentsto business and commerce can include, broadly speaking, languagedifferences, differences in customs, and a history of conflict between thecultures in questions.Language differences Any sort of transaction, whether a simple trade or a complexexchange, requires communication. In the case of international business transactions, one ofthe key elements in facilitating exchanges is the availability oftranslators or native speakers of the languages in question. For example, if Country A is weighing offers betweenCountries B and Country C, the traditional friendliness between A and Bcould doom the efforts of C, who has no history, good or bad, with A(Huntington, 1996).Political Impediments Politics are part and parcel of a nation's culture, but they canalso be distinct at times. Indeed, there appear to be some culturesthat take to it better than others (DeSoto, 2 ). Certain regimes can hold extreme positions thatare out of line with the tradition of the nations they are representing.Therefore, several potential political impediments will be consideredseparate from the cultural impediments described above.Ideology The reigning ideology of a nation can present severe impediments tobusiness transactions. (2 ). The cost of graft hasto be included in calculations of the total cost of any businesstransaction. The moreobscure the language of a nation or culture, the more difficult it will beto conduct international business. Thispaper seeks to identify some of the major impediments that may limit theability to "truck, barter, and exchange" across international borders.Cultural Impediments International boundaries are occassionally arbitrary and sometimessignify little more than power structure relationships. Key officials may still insiston a payoff before they will allow a transaction to be approved. New York: John Wiley and Sons. Introduction The president of General Motors once remarked that "the business ofAmerica is business." Although there are political and ideologicalmotivations behind that statement that can be criticized, the essentialidea behind the statement is true. A classic example is the former Soviet Union.Although Russia has often exhibited a closed attitude toward internationalbusiness, the Soviet Union was an extreme example based on ideology, ratherthan culture. (2 2). Against the Dead Hand: The Uncertain Strugglefor Global Capitalism. Often, it will never be enough to meet all the legal andregulatory requirements for a transaction. Theeffectiveness of a nation's law enforcement and its ability and willingnessto crack down on such corruption can be a crucial impediment to conductingtrans-national business.Conclusion As noted above, there are many serious impediments to theinternational conduct of business. While these impediments all remain in play and remainserious, businesses and nations are finding ways around them. A longer, more detailed paper wouldreveal that each of these impediments are even more serious than touched onhere. The big US auto manufacturers,for example, have moved many operations to Mexico to escape environmentalregulations at home. Hamelink, C.J. De Soto, H. The Mystery of Capital: WhyCapitalism Triumphs in the West and Fails Everywhere Else. Sometimes,however, the border is a meeting point between peoples who arefundamentally different from one another in many important ways. This results indifferences in trading styles among cultures, and in these differences,difficulties in bartering, trading and exchanging between cultures. Amsterdam, The Netherlands: Studentlitteratur AB. Lindsey, B. Transnational Data Flows in the InformationAge. Adam Smith, the father of moderncapitalism, believed that it was natural for all humans, regardless ofnationality, to "truck, barter, and exchange." Although this may be anatural human inclination, as in all things human, there are some of us whotake to it better than others. Again,however, the modern age has found solutions to this problem. Similarly, the recently deceased Ugandan dictator Idi Aminand the soo-to-be-deceased Iraqi strongman Saddam Hussein led regimes thatwere highly eccentric and presented multiple difficulties for internationalbusiness transactions.Regulations The regulatory stance of a nation can have severe impacts oninternational business transactions. In a fewyears, doing business with a merchant on the other side of the world may beas common as doing business across town is today. This is partly because of a lower cost of labor, butthe costs of regulation also play a part. Even if there is no history of enmity, history can stillplay a key role. It is obvious that such transactionswill occur much more smoothly if both or all participants are speaking thesame language. Most languages have dictionaries and grammaticalguides to aid the non-native, but many important cultural customs are notwritten down. Every nationthat is serious about doing business has legions of people trained in theprotocol of the various cultures with whom they will come into contact.History A final factor to consider is the history between the culturesinvolved in any possible transaction. In suchcases, the border is a cultural demarcation, in which things may be donevastly differently on one side compared to the other. Currently, we see the flight of mostlow skill manufacturing jobs away from highly developed nations to lessdeveloped nations. If there is a long history ofwarfare between the nations, this will present a serious hindrance to anybusiness exchange. While this is a good thing for Mexican business, itis an example of how a particular nation's attempt to regulate within it'sown borders can drive business away (Hamelink, 1984).Corruption In many nations, corruption is a way of life. However, business has become the business of humans,to alter the quotation that began this paper. The Clash of Civilizations and theRemaking of the World Order. In the modern age, theseimpediments are identified and hunted down as ruthlessly as predators werein earlier ages. Huntington, S.P. While it may be possible to learn a language in less than ayear, it may take an entire lifetime to learn a culture's customs. (1996). New York:Basic Books. In contemporary times, when the worldis filled with millions of multilingual people, the language problem is notthe barrier that it once was to conducting business, but it remains afactor to consider (Lindsey, 2 2).Differences in Customs Differences in customs may be more difficult to overcome thandifferences in language. In fact, the statement could be morebroadly applied beyond the United States. Even if the history is far in the past, it could stillplay a factor. New York: Simon and Schuster.

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