Over the recent year, a lot of new considerations have emerged in the global sphere, many of them concerning all aspects of human life. For business, especially, some of the emergent problems are important to recognize, as they should be properly taken into account by both leadership and management. This review will focus on some of the currently existing problems and appearing issues for MNE managers, who will be among the most affected by changes in the global environment.
Global Political Risks
The current political climate is a rather difficult one to access, as some of the long-standing problems have finally come to fruition. Taking into account the effects of the recent pandemic, all of the global problems are even further exacerbated. Firstly, one must take into account the changes in the USA. As a global trade partner and one of the most influential countries, its political climate must be taken into account when speaking of international politics. Most notably, the presidency of Donald Trump has come to an end, meaning that the domestic and international actions of the country are going to significantly change going forward (Emmer, 2020). With the inauguration of Joe Biden as the president, the approach of the US to international relations, other countries, as well as businesses has been changed. Knowing the peculiarities of the new president’s policies, as well as the actions of the senate is going to be more needed than ever. Furthermore, the political divide in the country is a cause for concern for the world at large as well. The right and the left are finding it increasingly hard to find common ground, meaning an increased likelihood of extreme policies and populous response.
Taking about other foreign political issues, the rise of China as a global market is also a point worth discussing. The country promises fruitful trade and good deals to many countries willing to engage with it, meaning that it is a good avenue to expand one’s business. Understanding the value of China, and other emerging markets is a crucial consideration to take right now.
In terms of regulation, most of the current problems have to do with the effects of Covid-19. Most countries are still in the process of recovery, meaning that both the population and the economy are not stable. Companies have to consider issues of worker compensation, insurance, as well as the lack of staff brought upon by the effects of the pandemic (Top 10 regulatory issues facing businesses in 2021 2021). For bigger companies, this might be an even bigger issue, as they have a large number of staff members to account for and manage.
Economic and Supply Issues
Supply problems also have many connections to the Covid-19 pandemic. In particular, it should be noted that trade between countries and territories is still rather strained, as the safety procedures need to be upheld. Some territories have more strict laws, prohibiting both travel and movement of certain goods in and from the country (Top 10 regulatory issues facing businesses in 2021 2021). The regulation can negatively impact the supply chain of a business, effectively cutting out its most vital lifeline. Furthermore, the economy is in the process of recovery, meaning that it is either not able to support businesses on their path to recovery, or is not reflective of the future trends that will likely emerge after the end of the pandemic. The situation is unstable and needs much consideration from the involved parties.
Emmer, M. (2020). Political trends in Business 2020 Report: Vistage. Vistage Research Center.
Top 10 regulatory issues facing businesses in 2021. Paychex. (2021).