BRIC Emerging Markets Essay Example | Topics and Well Written Essays - 3250 words

BRIC Emerging Markets - act ExampleIn run along with this, Lopez-Claros (2005) explains that the competitiveness of each state of matter to compete in the world commercialize is not limited to their ability to maintan exchange rate competitiveness but also the importance of improving their fruitivitity in order to increase the businesses return on investment and also improve the aggregate outgrowth among the four countries economy.As part of increasing the BRICs competitiveness against other countries around the world, enhancing ones knowledge on frugal maturation could empower each nation to positively act upon the challenges associated with the challenges related to FDI and trade, political stability and sustainability in each nation (Lopez-Claros, 2005 Henisz, 2000 Olson, 1996 Bhagwati, 1989).Globalization conceptively promotes the practice of free trading around the world. In line with this, balancing the volume of local and foreign trade activities is crucial in terms of maintaining a strong economic growth because allowing the import level of foreign goods to exceed the export level within a country is harmful in terms of the countrys economic development (Bhagwati, 1989).Given that a country becomes very(prenominal) dependent on the importation of goods and services, it is likely that the country would experience slow growth and unemployment problem because of the remarkable decline in the demand for locally manufactured and provided goods and services (Bhagwati, 1989). A great imbalance surrounded by the import and export is enough to cause the sudden decrease in the countries gross domestic product (GDP). (Campos & Coricelli, 2002 Boix, 1999)Political StabilityThe socio-political stability of Brazil, Russia, India, and China could significantly affect the economic development of each nation (Henisz, 2000) In line with this, several past research studies revealed that the governemnts ability not to interfere with the private shoes rights o f the businessmen is necessary in terms of maintaining the long-term capital investments necessary to enable the BRICs to experience a rapid economic growth (Henisz, 2000 Olson, 1996). Equally important for the continuous economic growth of BRICs, the government in each nation should develop and implement effective stabilization programs related to taxation, business regulation, and other applicable economic policies that could promote the increase in private investment (Henisz, 2000) aside from intervening on world(prenominal) trade activities like imposing import restrictions and providing export subsidies among others (Bhagwati, 1989). Whenever a new foreign business would memorialize the country, the government shuld impose a strict entry regulation in order to prevent the incidence of fly-by-night business operators (Djankov et al., 2002).With regards to tax policy, collected tax revenue should be invested in economic activities including the development of infrastructure, i mprovement in educational services, and investment on new technology in order to effect new job opportunity and demand for the local products and services (Lopez-Claros, 2005). All these can be soft achieve