QUESTION: How was Poland able to avoid the worst effects of the economic crisis that gripped most of Europe during 2008-2009?
Poland, which avoided the impacts of the economic crisis during 2008-2009, had the subjective and objective reasons. In 1989, the country had a first democratic government after some decades under the totalitarian Communist regime. The new government opened its market for the international trade and foreign investment, as well as privatized state-run companies. After some years, the country became a major exporter and was considered as a country had the highest growth in the region.
The subjective factor was Poland's government strictly controlled public debt without allowing to expand, regardless of the status of recession could happen. Some other counties in the region, such as Greece, acted otherwise, and as a result, the foreign investors ran away its markets to lead the public debt continued to rise and the currencies down. This caused the full-blown economic crisis, which needed helping of international organizations.
The objective factor was the early tight monetary policy helped the country avoid asset price bubbles. Although before that it was criticized, it was right at the stage of 2008-2009 crisis. Another objective factor was the country benefited from the economic stimulus of the neighbor Germany, which had a policy to exchange an old car for a new car.
QUESTION: From the perspective of international business, what is attractive about the Polish economy? What are the weaknesses and risks associated with doing business there?
The attractiveness of the Polish economy is the country has continued to change its policies to be appropriate for the market economy and the foreign investments, such as simplifying tax laws, reducing tax rates, and removing bureaucratic obstacles, as well as intensifying to privatize the state-run companies which have been often inevitable consequences of the post-Communist countries. The weaknesses and risks to do business in the country are the unemployment rate is high, and the tax system is complex. However, as above saying, the struggling of the democratic government can overcome the difficulties.
Management Focus: Starbucks Wins Key Trademark Case in China (p. 53 (custom)/p.103 (standard)
Discuss the concept of property rights protection and why it is so important to companies. What does the court ruling against Xing Ba Ke mean for other companies that are already doing business in China, or are considering entering the market?
The property rights protection is to protect the possession and exploitation of the property. The protection is based on the culture's customs and the laws of the country because the laws cannot cover all the culture's customs and behaviors of everyone. What is right or wrong, accepted or unaccepted sometimes is based on the modal behaviors rather than the rules of the laws. For companies, their tangible assets are able to see, touch, and evaluate them, but the intangible assets, such as trademarks, copyrights, and patents, are intelligent properties which affect the success or failure of a company, especially today, when the economy has significant features of knowledge and high-technology. Therefore, culture's customs which haven't respected the intelligent property rights will be easier to violate the rights intentionally or unintentionally.
By the end of the suitcase of Starbucks, when the court ruled against Xing Ba Ke, it shows that China is following international laws. Perhaps, in the case, China was being pressurized by the foreign government and WTO to respect the intellectual property rights, but the beginning is good for all parties participating in the game of global business. It is not only warning to the "clearly malicious" companies, but also encouragement over which companies are trading genuinely or are considering entering the market. China's market is very big, so the China's responsible behavior would help to attract more than the foreign investment.
