The irobot corporation case study

Document Type:Case Study

Subject Area:English

Document 1

Since the creation of the company, it has been growing at a steady pace and was incorporated in 2000. Since then the company has been performing relatively well in the recent times with many market analysts indicating that the company's stock is likely to increase in value at least into the first quarter of 2019 ("iRobot", 2018). The reason for the growth of this company is partly because of the market share that the automotive segment of the robotics industry. Research indicates that while the industrial robotics segment is the largest of robotics industry, the automotive segment has the largest market share. The increased need for automation is the reason for this growth considering that most industries are automating their processes and this trend is mirrored at the individual level. As a result, the country applies a uniform trade of 10 percent on all imports.

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The state has also eliminated any tariff exemptions as well as removed all import restrictions except for those that are related to health and state security. Most import charges ultimately total at between 30 and 45 percent of the total (Office of the United States Trade Representative, 2018). Bolivia's major trading country is Brazil, and the United States comes in at a close second. Petroleum products are the major imports for the country, while the major export commodity for the country is natural gas. However, there is still a long way to go on this regard. Currently, companies that want to work in Bolivia have to work hand in hand with the state department that provides vital information on operating businesses in Bolivia. Within the last 2 years, the trade balance between the United States and Bolivia has moved from a deficit of 318 million dollars to a surplus of 29 million dollars.

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The latest available data on foreign direct investment between the two countries was in the 2015-2016 financial year and US Stock was at 546 million dollars, a 20 percent increase from the previous year (Office of the United States Trade Representative, 2018). While these statistics show that US business in Bolivia are improving, there are barriers that the company should consider. It is important to note that the government has the ability to increase or reduce import taxes accordingly to protect local businesses. Licenses are another import restriction that should be considered. Bolivian law allows for the government to prohibit the importation of goods that can potentially affect human and animal life and or health as well as goods that might be harmful to the environment, affect morality as well as the security of the state.

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As recently as last year, there were 33 tariff lines that were affected by prohibitions. Goods such as hydrocarbons, arms and ammunitions, second hand clothing as well as some types of vehicles were affected by the prohibitions. Finally, in 2017, Bolivia was placed in a special 301 report. The reason for this was because of the weak intellectual rights protection and enforcement. There are indeed laws that are meant to protect the copyrights, trademarks and patents. However, there are major challenges pertaining to piracy and counterfeiting in Bolivia that the company should consider. Economic Analysis of Bolivia for FDI Bolivia's population is 10. Overall, the economic development of the state is severely hampered by the structural as well as institutional problems. Public debt currently stands for 42. percent of the entire GDP (Office of the United States Trade Representative, 2018).

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While the country is rich with resources, the country suffers from a variety of factors such as social and political unrest political suppression of alternative dissent and the drug war all deter foreign investment and stifle economic growth. There are a variety of factors that significantly limit local and international entrepreneurial activity. Compared to other Latin American countries, Bolivia has a higher number of procedures required to open a business and this is also the case when it comes to the number of days setting up a company requires. On average, there are 14 business procedures needed to open a business and the average number of days is 45 (United Nations, 2018). This is 6 more processes and 14 days more compared to neighboring countries. All these factors have a negative impression on businesses that can potentially set up in the country.

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References Bolivia | Data. Geneva: United Nations Publication.

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