Transcanada Pipelines Case Study
International Projects TransCanada Pipelines
Adiari Acuna 300740767
Carlos Hernandez 300
Karem Martin 300
Caroline Lara 300
Professor: Patrick Ellwoo
International Banking and Finance
INTL 702
Section 102
October 2014
Table of Contents
Purpose of the Report 1
Indexes per Country 1
Russia 1
Purpose of the Report
This report is intended to TransCanada Pipelines employees that will be involved in international projects in Brazil, Russia, Japan and Kenya. As they are going to stay outside Canada for five years, they need to know what are the pros and cons to stay there in order to be prepared in the case that they accept the offer. Each country will be analyzed in terms of financial, political, legal and social …show more content…
context.
Then three financial cases regarding to loans will be discussed per country: (1) purchase of a house/condo/townhouse that requires $400,000 in financing; (2) purchase of a car that requires a $40,000 loan; (3) borrowing of $50,000 to establish a business.
Indexes per Country
Some indexes were selected to analyze situations in each country.
To have a better understanding, the meaning of each index will be explained briefly.
Personal Income Tax Rate: the average rate that a citizen has to pay for taxes purpose based on the personal income in one fiscal year. This information will be found on KPMG table (KPMG).
Unemployment rate: percentage of the population that is looking for a job but they haven’t found it. This information is taken from CIA website (The World Factbook, CIA).
Current Account balance: according to The World Factbook, “this entry records a country 's net trade in goods and services, plus net earnings from rents, interest, profits, and dividends, and net transfer payments (such as pension funds and worker remittances)”. (The World Factbook, CIA)
Quality of Life: this index is a combination of several indexes such as, Purchasing Power Index, Safety Index, Health Care Index, Consumer Price Index, property Price to Income Ratio, Traffic Commute Time Index and Pollution index. Statistics center, numbeo.com, developed a formulate to get the index Quality of Life index. (Numbeo)
Poverty index: Poverty headcount ratio at national poverty line (% of population) (Rural Poverty,
2014)
Education: Public expenditure on education as % of total government expenditure is the total public education expenditure (current and capital) expressed as a percentage of total government expenditure for all sectors in a given financial year. Public education expenditure includes government spending on educational institutions (both public and private), education administration, and subsidies for private entities (students/households and other privates entities).
UNESCO Institute for Statistics
Crime level: Level of crime. Based on 0-50 contributions for Afghanistan, Albania, Algeria and 82 more countries and 50-100 contributions for Argentina, Belgium, Bulgaria and 24 more countries and over 100 contributions for Australia, Brazil, Canada and 17 more countries. The surveys were conducted by numbeo from July, 2011 to February, 2014. See this sample survey for the United States, respondents were asked "How serious you feel the level of crime is?". The higher the value, the more survey respondents believe it is high in their country (World Bank, 2014).
Murder Rate: Homicide rate per year per 100,000 inhabitants in various countries (Nation Master, 2014).
Quality of health care system: The quality will be measure by Accuracy and completeness in filling out reports, convenient location, cost, friendliness and courtesy of staff, healthcare system index, modern equipments, short waiting times, skill and competence of medical staff and speed in delivering examinations and reports (Nation Master,2014).
Kenya
The Republic of Kenya is located on the East African. It is bordered by Ethiopia and Sudan to the north, the Indian Ocean and Somalia to the east, the United Republic of Tanzania to the south, and Uganda and Lake Victoria to the west. The total area of the country is 580 370 km2 (The World Factbook, CIA).
Political context:
Kenya’s political context had been influenced by massive contestations against centralization and abuse of power, as well as corruption, a constitutional review that lasted around 20 years and post-election violence. In 2010, the new constitution was approved which allowed them to have more peaceful election. However, in 2013 Kenya is still in transition from political crisis. (Interactions Eldis).
Legal context:
Kenya’s legal system is a combination of English common law, civil law and religious law. The government is divided into executive, legislative and judicial function (UNESCO).
Climate:
Kenya’s climate varies from tropical beside coast to arid in interior (The World Factbook, CIA).
Financial and social indicators:
STAT
AMOUNT
DATE
RANK
HISTORY
Budget > Revenues
$7.42 billion
2013
91st out of 223
Exports
$6.23 billion
2012
101st out of 189
Fiscal year
1
2013
GDP
$37.34 billion
2012
82nd out of 177
GDP > Composition by sector > Industry
14.8%
2012
188th out of 217
GDP > Per capita
$1,658.46 per capita
2007
151st out of 183
GDP > Per capita > PPP
$1,800.00
2012
156th out of 188
GDP > Purchasing power parity
$75.00 billion
2012
82nd out of 190
GDP > Real growth rate
4.6%
2012
70th out of 191
GDP per capita
$864.74
2012
150th out of 177
Gross National Income
$10.66 billion
2001
71st out of 158
Population below poverty line
50%
2000
5th out of 18
Public debt
52.5% of GDP
2012
55th out of 149
Tourist arrivals
1.64 million
2006
65th out of 182
Unemployment rate
40%
2008
3rd out of 26
HISTORY
Agricultural workers > Male
20%
2010
27th out of78
Employment rate > Adults
73
2008
15th out of165
Crime levels
91.25
2014
4th out of 93
Drugs > Annual cannabis use
2.1%
2007
22nd out of 26
Fear of crime > Feels safe walking alone > At night
9.52
2014
88th out of 93
Murder rate
3.6
2008
Life expectancy at birth > Total population
59.48 years
2011
183th out of 216
Life expectancy at birth, male > Years
58.71
2011
166th out of 196
Life expectancy at birth, total > Years
60.37
2011
163th out of 196
Physicians > Per 1,000 people
0.14 per 1,000 people
2004
42nd out of 67
Probability of reaching 65 > Male
38.5%
2050
135th out of 159
Quality of health care system > Health care system index
62.92
2014
10th out of 23
Recommendations:
References
Country Studies . 2013. <http://countrystudies.us/russia/69.htm>.
Interactions Eldis. n.d. 19 10 2014. <http://interactions.eldis.org/unpaid-care-work/country-profiles/kenya/social-economic-and-political-context-kenya>.
KPMG. 2014. <http://www.kpmg.com/global/en/services/tax/tax-tools-and-resources/pages/individual-income-tax-rates-table.aspx>.
Numbeo. 2014. <http://www.numbeo.com/cost-of-living/>.
The World Factbook, CIA. 2014. <https://www.cia.gov/library/publications/the-world-factbook/>.
Transparency International. 2013. <http://www.transparency.org/country#RUS>.
UNESCO. n.d. 19 10 2014. <http://www.unesco.org/shs/ethics/geo/user/?action=Geo4Country&db=GEO4&id=29&lng=en>.
Adiari Acuna 300740767
Carlos Hernandez 300
Karem Martin 300
Caroline Lara 300
Professor: Patrick Ellwoo
International Banking and Finance
INTL 702
Section 102
October 2014
Table of Contents
Purpose of the Report 1
Indexes per Country 1
Russia 1
Purpose of the Report
This report is intended to TransCanada Pipelines employees that will be involved in international projects in Brazil, Russia, Japan and Kenya. As they are going to stay outside Canada for five years, they need to know what are the pros and cons to stay there in order to be prepared in the case that they accept the offer. Each country will be analyzed in terms of financial, political, legal and social …show more content…
context.
Then three financial cases regarding to loans will be discussed per country: (1) purchase of a house/condo/townhouse that requires $400,000 in financing; (2) purchase of a car that requires a $40,000 loan; (3) borrowing of $50,000 to establish a business.
Indexes per Country
Some indexes were selected to analyze situations in each country.
To have a better understanding, the meaning of each index will be explained briefly.
Personal Income Tax Rate: the average rate that a citizen has to pay for taxes purpose based on the personal income in one fiscal year. This information will be found on KPMG table (KPMG).
Unemployment rate: percentage of the population that is looking for a job but they haven’t found it. This information is taken from CIA website (The World Factbook, CIA).
Current Account balance: according to The World Factbook, “this entry records a country 's net trade in goods and services, plus net earnings from rents, interest, profits, and dividends, and net transfer payments (such as pension funds and worker remittances)”. (The World Factbook, CIA)
Quality of Life: this index is a combination of several indexes such as, Purchasing Power Index, Safety Index, Health Care Index, Consumer Price Index, property Price to Income Ratio, Traffic Commute Time Index and Pollution index. Statistics center, numbeo.com, developed a formulate to get the index Quality of Life index. (Numbeo)
Poverty index: Poverty headcount ratio at national poverty line (% of population) (Rural Poverty,
2014)
Education: Public expenditure on education as % of total government expenditure is the total public education expenditure (current and capital) expressed as a percentage of total government expenditure for all sectors in a given financial year. Public education expenditure includes government spending on educational institutions (both public and private), education administration, and subsidies for private entities (students/households and other privates entities).
UNESCO Institute for Statistics
Crime level: Level of crime. Based on 0-50 contributions for Afghanistan, Albania, Algeria and 82 more countries and 50-100 contributions for Argentina, Belgium, Bulgaria and 24 more countries and over 100 contributions for Australia, Brazil, Canada and 17 more countries. The surveys were conducted by numbeo from July, 2011 to February, 2014. See this sample survey for the United States, respondents were asked "How serious you feel the level of crime is?". The higher the value, the more survey respondents believe it is high in their country (World Bank, 2014).
Murder Rate: Homicide rate per year per 100,000 inhabitants in various countries (Nation Master, 2014).
Quality of health care system: The quality will be measure by Accuracy and completeness in filling out reports, convenient location, cost, friendliness and courtesy of staff, healthcare system index, modern equipments, short waiting times, skill and competence of medical staff and speed in delivering examinations and reports (Nation Master,2014).
Kenya
The Republic of Kenya is located on the East African. It is bordered by Ethiopia and Sudan to the north, the Indian Ocean and Somalia to the east, the United Republic of Tanzania to the south, and Uganda and Lake Victoria to the west. The total area of the country is 580 370 km2 (The World Factbook, CIA).
Political context:
Kenya’s political context had been influenced by massive contestations against centralization and abuse of power, as well as corruption, a constitutional review that lasted around 20 years and post-election violence. In 2010, the new constitution was approved which allowed them to have more peaceful election. However, in 2013 Kenya is still in transition from political crisis. (Interactions Eldis).
Legal context:
Kenya’s legal system is a combination of English common law, civil law and religious law. The government is divided into executive, legislative and judicial function (UNESCO).
Climate:
Kenya’s climate varies from tropical beside coast to arid in interior (The World Factbook, CIA).
Financial and social indicators:
STAT
AMOUNT
DATE
RANK
HISTORY
Budget > Revenues
$7.42 billion
2013
91st out of 223
Exports
$6.23 billion
2012
101st out of 189
Fiscal year
1
2013
GDP
$37.34 billion
2012
82nd out of 177
GDP > Composition by sector > Industry
14.8%
2012
188th out of 217
GDP > Per capita
$1,658.46 per capita
2007
151st out of 183
GDP > Per capita > PPP
$1,800.00
2012
156th out of 188
GDP > Purchasing power parity
$75.00 billion
2012
82nd out of 190
GDP > Real growth rate
4.6%
2012
70th out of 191
GDP per capita
$864.74
2012
150th out of 177
Gross National Income
$10.66 billion
2001
71st out of 158
Population below poverty line
50%
2000
5th out of 18
Public debt
52.5% of GDP
2012
55th out of 149
Tourist arrivals
1.64 million
2006
65th out of 182
Unemployment rate
40%
2008
3rd out of 26
HISTORY
Agricultural workers > Male
20%
2010
27th out of78
Employment rate > Adults
73
2008
15th out of165
Crime levels
91.25
2014
4th out of 93
Drugs > Annual cannabis use
2.1%
2007
22nd out of 26
Fear of crime > Feels safe walking alone > At night
9.52
2014
88th out of 93
Murder rate
3.6
2008
Life expectancy at birth > Total population
59.48 years
2011
183th out of 216
Life expectancy at birth, male > Years
58.71
2011
166th out of 196
Life expectancy at birth, total > Years
60.37
2011
163th out of 196
Physicians > Per 1,000 people
0.14 per 1,000 people
2004
42nd out of 67
Probability of reaching 65 > Male
38.5%
2050
135th out of 159
Quality of health care system > Health care system index
62.92
2014
10th out of 23
Recommendations:
References
Country Studies . 2013. <http://countrystudies.us/russia/69.htm>.
Interactions Eldis. n.d. 19 10 2014. <http://interactions.eldis.org/unpaid-care-work/country-profiles/kenya/social-economic-and-political-context-kenya>.
KPMG. 2014. <http://www.kpmg.com/global/en/services/tax/tax-tools-and-resources/pages/individual-income-tax-rates-table.aspx>.
Numbeo. 2014. <http://www.numbeo.com/cost-of-living/>.
The World Factbook, CIA. 2014. <https://www.cia.gov/library/publications/the-world-factbook/>.
Transparency International. 2013. <http://www.transparency.org/country#RUS>.
UNESCO. n.d. 19 10 2014. <http://www.unesco.org/shs/ethics/geo/user/?action=Geo4Country&db=GEO4&id=29&lng=en>.