Analytical Report on China Emerging Market and Economy

The sources of these business documents include emails, and internal memos chosen to write a formal report. The business promotion and interesting opportunities depend on the efforts placed in cultivating the key business skills, the identification of foreign market challenges, locating and summarizing data smart visualization, and business ideas conveying to the audience. Introduction A major debate has arisen surrounding the economic prospects of China. For instance, the president declared in the 2018 World Economic Forum that the economy of the country is already among top five across the world hitting at $8 trillion by 2025. According to the media, pointing out of the country's sinking superficial middle session and the expanding unemployed and inequality including an influx of multinationals is attributed to the growth in the country's experiment.

The Chinese business environment is faced with a number of challenges for the corporations in the consumer industry. Equally, the worldwide companies like Xiaomi, Unilever, Honda, Hyundai, Suzuki, Colgate, and Samsung, have been intelligent to overcoming trials including some constrictions to do outstandingly well in the economic pyramid in the middle (Bhaumik, Driffield, & Zhou, 2016). Literature Review There exist a number of success stories in China's consumer economy. For instance, Renault's ultra-low-cost car like Kwid car and Amazon has reported great success stories. A company like Amazon entered the country in 2016 when three local companies like Snapdeal and Fluipkert had made themselves as the market cream of the crop in the field of e-commerce and tranquility rose to become the first online store in the country (Hong, Wang, & Kafouros, 2015).

This can be mainly attributed to the fact that Apple has adopted a better commercial model for attracting more Chinese consumers, unlike its key competitors; Samsung and Xiaomi (Bussière, Delle Chiaie, & Peltonen, 2014). The startup network currently stands as the largest in the ecosphere and maturing rapidly since the market is not extensive and subjugated by e-commerce copycat organization. In essence, technology startup organization has fascinated more than $25 billion in the last three years. There are a number of factors that have driven these boom, for instance, China's has invested greatly in technology infrastructure. The technology volunteers and government agencies have come together in setting up "China Stack" with API providing businesses, governments, developers and startups with a mutual digital organization on which they can deliver and build paperless, presence - less, and cash-less services.

The other issue is that China’s problem cannot be cracked without leverage expertise. For instance, China has a great shortage of medical professionals and hospital divans as compared to the population of 2. 6 billion. The teaching sector has suffered too from a few colleges and few teachers. In fact, the legal sector structure might take 30 years in clearing the accumulation of all the suitcases now pending (Zhou, Sheng, S. Because of this, the remote agents would now be able to set up rupee or outside money named records to credit internal settlements, financier expenses, and commissions. Every company faces different challenges whereby some are unique to the company set up, nature and the environment of operation. Fluctuation of the currency of commodities is one of the global challenges facing most of the companies whereas China is not left behind.

This is the situation whereby the prices of different commodities vary; they may go up or drop. Since the company has its operations all over the world, which include exportation of its products to other parts of the world, a variance in currency poses a great risk to the normal procedures of the company (Anderson, & Sutherland, 2015). The volatility in prices for powerful products, motorcycles, and automobiles in some markets has experienced a great change in the short time period. This volatility is caused by high price of materials, shortage in supply of materials, shortage in material supply, a change in import regulations, the prevailing economic situations, and fluctuation in the short term. Fluctuation in currency rates due to the application of foreign currency in the purchase of the products.

The fluctuations in currency bring an effect on the result of China's financial and operating conditions not forgetting the competitiveness of the firm in the long run which ends up affecting its performance. The company adopted No. The measurement in fair value, China adopted some SFAS No 157 as the price that was received upon the sale of an asset or a liability transfer. A considerable consumer confidence loss is as a result of foreign exchange fluctuation due to the slowdown in the economy, financial crisis, fuel price rise, changes in consumer preference and recession. It is a daunting task to hedge against all other currencies. Accordingly, the company has applied the hedging derivative technique in an effort of reducing the impacts of currency fluctuations and the exposure to interest rates on the financial conditions and cash flows.

The techniques that the company has applied include swap in interest rates, optional contacts on currency and swap agreements on currency and forward contracts. Despite being the largest manufacturer in Japan it still lags behind. Figure 1: The composition and age structure of China’s population. Figure 2: China’s employment levels as of the year 2018. The Chinese government has wiped out the state of profit adjusting for everything except 31 customer products businesses. What's more, the Reserve Bank of China (RBC) now permits 100% outside venture with regards to the development of streets or scaffolds. Size of China China's GDP is at present US$6. 7 trillion, creating it the second biggest economy in the entire world. Be that as it may, in PPP rapports, which distinguishes China's minimal effort base, the GDP hypothetically increases to three epochs this sum (US$3.

8 trillion). This has placed China on a comparable size to other countries and. Socioeconomics In the world, China is comprised of very youthful citizens with an average age of 29. The working population age of the entire population is considered to increase by close to 320 million in a span of 21 years. The population has hard-working citizens, with an extensive amount of training. The majority ruling government has ensured the population has great aptitude and culture of entrepreneurship in the country. In 19 years time, China will place herself as the world's largest economy 5. The International business report gains traction through the synthesis of a diverse range of secondary sources that address the challenges that MNEs face in the 21st century. According to statistics Netherlands, secondary sources provide data that can be used to answer research questions for new studies (Daa & Toth, 2012).

Therefore, this research is justified to leverage on the existing research findings to come up with a conclusive analysis of the challenges and advantages of investing in the Chinese market. Findings It is evident from the literature review that, firms investing in China face a myriad of challenges. For instance, the literature review pinpoint that most of the firms face challenges such as increases in taxation, recession, government controls and currency fluctuations. International financial spillovers to emerging market economies: How important are economic fundamentals? Journal of International Money and Finance, 76, pp. Anderson, J. , & Sutherland, D. Developed economy investment promotion agencies and emerging market foreign direct investment: The case of Chinese FDI in Canada.  Journal of world business, 50(4), 815-825. Energy Economics, 54, pp.

Bekaert, G. , & Harvey, C. Emerging equity markets in a globalizing world. Bhaumik, S. , Delle Chiaie, S. and Peltonen, T. A. Exchange rate pass-through in the global economy: the role of emerging market economies.  IMF Economic Review, 62(1), pp. cbs. nl/NR/rdonlyres/D1E23FC9-7887-4637-8AC9-ABABBF54C508/0/2012Secundarydatacollectionart. pdf Gay, R. D. Effect of macroeconomic variables on stock market returns for four emerging economies: Brazil, Russia, India, and China. Hernandez, E. and Guillén, M. F. What’s theoretically novel about emerging-market multinationals?.  Journal of International Business Studies, 49(1), pp. Kotabe, M. , & Helsen, K.  Global marketing management. Mac, L. , & Evangelista, F. Surdu, I. , Mellahi, K. , & Glaister, K. Emerging market multinationals’ international equity-based entry mode strategies: Review of theoretical foundations and future directions.