Brazil Case Study

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1. In your opinion, is there still political uncertainty in Brazil? Political risks is defined as the unanticipated likelihood that foreign investment of business will be constraint by a host government policies (Luthans, 2014). However, when political parties of Brazil or any other nation change any rulings the risk increases. In addition, democracy countries like Brazil my face additional risks because of factors that impact their economy. Therefore, political risks have different characteristics such as Transfer (i.e. stem from government policies that limit the transfer of capital, money, labors, technology, etc. from host country) operational risk (i.e. policies from the host government that directly places a constraint on management and…show more content…
Because Brazil problems should have been addressed prior to becoming a MNC in that country and in that respect MNCs should have consider both macro and micro risks of that country to minimize any risks with any operations in a developing or emerging economies. Risks are high and expected; so are high returns and long term potential. Brazil offers advancement as far as market and expansion through neighboring countries and has the easiest entry than other South American Countries. Therefore, both BellSouth and AES should consider the government policies of Brazil by meeting their concerns. By adjusting their strategies MNCs can use various techniques (i.e. integrative, protective, defensive and…show more content…
Therefore, MNCs may consider joint ventures and/or outsourcing as alternatives. Providing social responsibility to align with the need of the culture of Brazil that will provide a better picture of the MNC and this will provide support from the locals and help their operations within the country. MNCs should use micro methods to improve their operations. In addition, if MNCs human resource practices are more focused on the culture of Brazil this may help them as far as being motivated and provide a competitive advantage in an unstable
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