Political Analysis on China Essay Example
POLITICAL ANALYSIS ON CHINA
MADE BY SUMIT GULATI(MBA STRATFORD USNIVERSITY, MAII, LAJPAT NAGAR)
INTRODUCTION
CHINA talks capitalism, but breathes socialism….
In other words, that society has to undergo capitalist transformation before the correct conditions for socialism can exist - said by Karl Marx.
Political System of china
China has been under the communist party rule for many decades. The communist party exercises absolute power over legislations and economic and cultural institutions. China rules and regulations are not so transparent or absolute. Due to lack of transparency and corruption the social network with the people from the communist party can help the business avoid red tape and bureaucracy.
POLITICAL RISK
A political risk refers to government interference in the business affairs of foreign persons or companies doing business in a particular country.
China is particularly hazardous with respect to political risk. In fact this has occurred in china in 1949. There are the risk of confiscation, risk of expropriation, and risk of contract repudiation.
A unique form of political risk occurs in china, and this is the constant battle between the country’s central government and the provincial and local governments over applicable law, and observance or non-observance of it. This makes it difficult for companies operating in China to know exactly what the rules are.
Other Political risk of China are as follows-
1) Political Effectiveness-
Political effectiveness is actually not very effective in china as compared to other countries. Barely anyone bothers to call the police and they be easily bribed.
Road laws are not enforced and thus there is a high rate of accidents in China with the way they drive. The government is even less confident than outside observers regarding their nation’s political stability.
2) Institutional Stability-
Corruption still plays a huge role in China. They believe that profit comes
MADE BY SUMIT GULATI(MBA STRATFORD USNIVERSITY, MAII, LAJPAT NAGAR)
INTRODUCTION
CHINA talks capitalism, but breathes socialism….
In other words, that society has to undergo capitalist transformation before the correct conditions for socialism can exist - said by Karl Marx.
Political System of china
China has been under the communist party rule for many decades. The communist party exercises absolute power over legislations and economic and cultural institutions. China rules and regulations are not so transparent or absolute. Due to lack of transparency and corruption the social network with the people from the communist party can help the business avoid red tape and bureaucracy.
POLITICAL RISK
A political risk refers to government interference in the business affairs of foreign persons or companies doing business in a particular country.
China is particularly hazardous with respect to political risk. In fact this has occurred in china in 1949. There are the risk of confiscation, risk of expropriation, and risk of contract repudiation.
A unique form of political risk occurs in china, and this is the constant battle between the country’s central government and the provincial and local governments over applicable law, and observance or non-observance of it. This makes it difficult for companies operating in China to know exactly what the rules are.
Other Political risk of China are as follows-
1) Political Effectiveness-
Political effectiveness is actually not very effective in china as compared to other countries. Barely anyone bothers to call the police and they be easily bribed.
Road laws are not enforced and thus there is a high rate of accidents in China with the way they drive. The government is even less confident than outside observers regarding their nation’s political stability.
2) Institutional Stability-
Corruption still plays a huge role in China. They believe that profit comes