International Marketing Management Key Aspects

International Marketing Management Key aspects of political & economic situation. Botswana, or the republic of Botswana is a Southern Africa nation, which borders with Angola, Zambia, Namibia, Zimbabwe and South Africa. Botswana, originally a British protectorate adopted its original name and became independent on September 30, 1966. The economy of the country has very close ties with South Africa and is characterized by mining (rich in diamonds), agriculture and tourism. Botswana occupies the territory of 231,788 mi2 (600,370 km2), with desert Kalahari covering nearly 70% of its territory.

In the Northwest there is world's largest inland river delta- the Okavango Delta. River deltas, savannas, and Kalahari Desert are the home for various species of wildlife which populate this African country. Botswana is a western-type presidential democracy, with a president who is both the head of the state and the head of the government. Parliament is represented by a multi-party plural system: "Executive power is exercised by the government. Legislative power is vested in both the government and the Parliament of Botswana.

Since independence the party system is dominated by the Botswana Democratic Party. The Judiciary is independent of the executive and the legislature." (From (http://en.wikipedia.org/wiki/Botswana) In a relatively short period of time (40 years), Botswana had transformed from one of the world's poorest countries into an "upper middle income" market with the highest credit rating in Africa.

Natural resources, mainly diamond mines and reasonable government management policy of natural resources contributed to the development of industrial infrastructure, growth of foreign investments into non-mining sector of economy and it also allowed country to build a welfare system. That's why most of specialists today agree that Botswana is a stable democracy with open economy. Several decades of political stability and economic development serve as the best proof of it, especially if to compare it with insurgence in neighboring states upnorth (Angola, Zimbabwe).

Botswana today takes an active participation in economical development and cooperation in South Africa. it's the member of Southern African Customs Union (SACU), which is an agreement among South African States to develop equal conditions for good exchange and trade in order to stimulate economic development and mutual trade under equal opportunities. Macroeconomic indicators of Botswana show stability of economy making country attractive for investments. GDP had grown by 13.8% in a period from 2001/02 to 2002/03, real GDP growth is considered to be around 6,8% in 2002/03.

Growth in mining industry production is about 10%, in mining sector of economy it's estimated to be around 4,8% and agricultural sector had shown 1,9% growth in 2002/03. Bank interest rates in Botswana are also high and among the highest in Africa: from 14.25% to 15.75%. Inflation rate is about 6.7%, which indicates stability of economy, especially if to take into consideration that Botswana is a developing country.

Today Botswana's government understands that it's impossible to stimulate country's economy only by intensive mining as diamonds will not bring prosperity to country in future due to a number reasons. First of all it would be impossible to employ the most part of population in mining and mining-relating industries, so there is a need to create a long-term infrusture, which will guarantee working places for the next generations and which will be profitable for the country.

It expalins why Botswana is very interested today in development of tourism and especially eco tourism in order to save existing natural features and resources to future generations: "The trade, hotels and restaurants sector has been growing by more than 10% per annum in recent years, showing the huge potential of tourism. Investment by the private sector in the Botswana economy as a whole has increased from P150m to P500m over the past ten years.

Tourism investment has increased even faster from P12m to P55m." (From Tourism ripe for investment) 2. Identify any government tax or other financial incentive that may apply to a foreign (Service Sector) firm Today government of Botswana provides a favorable investment climate for foreign investments that are ready to invest in non-mining sector of economy.

Such practices according to the opinion of specialists will allow to create a developed infrastructure, will allow the country to introduce innovative technologies in all spheres of life, will increase skills and qualifications of workers and from the other side will allow to save unique natural resources of the country. Government pays a special attention to investment in private sector of economy though special economic measures and opportunities such as attractive system of taxation, no exchange controls, etc.

No exchange control in Botswana includes free reparation of profits, dividends and capital. Corporate tax for manufacturing companies and accredited financial organizations is only 15%, for other forms of business it's 25%. Government of Botswana also works on its taxation regulations: "From 1999 a new non-negotiable mining tax formula was introduced in order to provide international investors with greater certainty.

A variable rate income tax was introduced with parameters set at internationally competitive levels, between a minimum of 25% and a maximum of 55%.." (from (http://www.discover-botswana.com/articles/doingbusiness.php) very important fact for foreign investors is that Botswana has zero tolerance towards corruption. An international.