Exploring International Business Environment




                             TABLE OF CONTENTS                           ...
Exploring International Business Environment

 1. Record of Investigation: Diary of thought, discussion and decision (Shee...
Exploring International Business Environment

Monday,     Analysis of     We met in the morning and started our presentati...
Exploring International Business Environment

                                2. Mr. Shashwat Sood contacted following per...
Exploring International Business Environment

            Validating       As soon as we completed validating uncertaintie...
Exploring International Business Environment

            Scenario        For    the Scenario Matrix we considered followi...
Exploring International Business Environment

             Impact of       The team created a matrix to give an overview t...
Exploring International Business Environment

 Day/ Date      EIBE Subject - What           What actions do we take to add...
Exploring International Business Environment

2. Honduras – An Overview
                  verview
Data Source(s)
http://ww...
Exploring International Business Environment

   ⇒ Oswaldo López Arellano 1965
                            1965-1971 PN
  ...
Exploring International Business Environment

   ⇒ Growth rate: 6.3%
   ⇒ Per capita GDP: $1,635 (official exchange rate) ...
Exploring International Business Environment


3. Identification of Uncertainties (Sheet 2)

Areas of investigation & the ...
Exploring International Business Environment


Ethics
   ⇒ Does increase in tourism leads to increase in prostitution
    ...
Exploring International Business Environment


Macro-Economic
   ⇒ Is increase in child mortality an impact of de centrali...
Exploring International Business Environment


Technological
   ⇒ Ability of government to curb loss of energy in transmis...
Exploring International Business Environment

4. Plausible Alternative Outcomes (Sheet 3)

        Uncertainties          ...
Exploring International Business Environment

       Uncertainties                  Plausible Outcome A                   ...
Exploring International Business Environment

        Uncertainties                  Plausible Outcome A                  ...
Exploring International Business Environment

       Uncertainties                    Plausible Outcome A                 ...
Exploring International Business Environment

        Uncertainties                   Plausible Outcome A                 ...
Exploring International Business Environment

         Uncertainties                   Plausible Outcome A                ...
Exploring International Business Environment

         Uncertainties                 Plausible Outcome A                  ...
Exploring International Business Environment


        Uncertainties                     Plausible Outcome A              ...
Exploring International Business Environment


        Uncertainties                  Plausible Outcome A                 ...
Exploring International Business Environment

5. Clustering of Uncertainties (Sheet 4)

Cluster Heading                   ...
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
Scenario Planning to Achieve UNDP's MDG for Honduras
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Scenario Planning to Achieve UNDP's MDG for Honduras

  1. 1. Exploring International Business Environment TABLE OF CONTENTS PAGE 1. Record of Investigation: Diary of thought, discussion and decision Diary 02 - 09 2. Honduras: An Overview verview 10 - 12 3. Identification of Uncertainties 13 - 16 4. Plausible Alternative Outcomes 17 - 25 5. Clustering of Uncertainties 26 - 28 6. Validating Clusters 29 - 39 7. Remarkable Person 40 - 41 8. Impact/ Predictability Analysis 42 9. Framing and Scoping Scenario End States 43 10. Stakeholder Analysis 44 11. Iceberg Analysis 45 12. Scenarios vs. achievement of Millennium Development Goals 46 13. Scenario Stories 47 - 61 14. Identification of Key Indicators (for each of the scenarios) ndicators 62 15. Bibliography 63 - 64 Scenario Investigation & Analysis – Iteration 2 2
  2. 2. Exploring International Business Environment 1. Record of Investigation: Diary of thought, discussion and decision (Sheet 1) iary Day/ Date EIBE Subject – What actions do we take to address? Action by? What do we not know? Friday, 2nd Getting In evening we meet to discuss what should be the plan By All October started for iteration 2. We questioned with each other to about 2009 which country to choose. We came to a conclusion that none of us has any knowledge about country in central America. So we opted for Honduras as country for iteration 2 by our rando choice. random Then we discussed what should be the approach to do the research. We divided the whole research into 7 different topic which are as follows: follows:- ⇒ Cultural ⇒ Economic ⇒ Environmental ⇒ Ethical ⇒ Legal ⇒ Political ⇒ Technological We discussed within the members that we should have holistic view of all the topics that we are doing for Honduras. To get that holistic view we decided that same topic should be studied and researched by more than one person to get a multi dimensional view of the subject mentioned abov in context of Honduras. above We divide the topics as follows in the team: team:- ⇒ Mr. James Mckenna, Mr. Narayanan Vishwanathan and Mr. Shashwat Sood are doing research on Economic, Environmental and Ethical aspects of Honduras. ⇒ Mr. Chandra Shekhar, Mr. Vaibhav Mehta and ta Mr. Sanil Subhash Chandra Bose are doing research on Legal, Political and Technological aspects of Honduras. We decided that Cultural part will be studied by all members to get better insight of the country. Simultaneously, we decided that we will complete our research within next two days i.e. 3rd and 4th October 2009. We also decided that we will do our research from home and we will meet on Monday 5th, 2009 at 9.30 a.m. with our individual presentations to be discussed presentations, within the group. Over the weekend the group e mailed each other with e-mailed salient research points to ensure we did not go down the same dead ends. This was useful and constructive. Scenario Investigation & Analysis – Iteration 2 3
  3. 3. Exploring International Business Environment Monday, Analysis of We met in the morning and started our presentation to 5th the research the group. October 2009 Our first hurdle was that the presentation requirement had been interpreted differently by different members of the group this was discussed and put down to experience. The presentation were given by following sequence: ⇒ Mr. James Mckenna ⇒ Mr. Shashwat Sood ⇒ Mr. Chandra Shekhar ⇒ Mr. Vaibhav Mehta ⇒ Mr. Sanil Subhash Chandra Bose ⇒ Mr. Narayanan Viswanathan The group noted down the points to be challenged and those that required more data to support them, while each member of the team presented. After completion of the presentation we all discussed the various factors and analyzed with our individual knowledge of the subject. This took long time up until the afternoon when we finally had a very clear picture of the past and pre present situation of the Honduras. We noted down some questions that needs to be answered through more research to get a clearer picture of the country. Simultaneously, we checked our questions with regard to Millennium Development Goal (MDG) of UNDP to align our research in right direction. ign We continued to research till 4.30 PM and then started to write our uncertainties. At 6.30 we had almost completed the uncertainties. We discussed how we should validate the uncertainties so that we would have no ambiguambiguous ones. It took close to one hour to recheck the uncertainties individually. After this self checking that we thought we self-checking should refine our uncertainties tomorrow. Simultaneously, we searched for remarkable people (RP). Everybody was doing individual eff effort for RP. 1. Mr. James Mckenna contacted following organizations for RP: ⇒ Amnesty International ⇒ Save the Children ⇒ Medicine Sans Frontier ⇒ Jesiut Mission in London ⇒ Jesiut Mission in Minnesota ⇒ Overseas Development Institute Scenario Investigation & Analysis – Iteration 2 4
  4. 4. Exploring International Business Environment 2. Mr. Shashwat Sood contacted following person lowing and organization: ⇒ Mrs. Margret English ⇒ Mr. Jim Wilson-International Office, University fice, of Strathclyde ⇒ Mr. Francisco Galeano-Country direct Country director, FINCA-small loans, Honduras ⇒ Mr. Miguel Giron-The Children’s rescue The Mission, 3 Papp Street, Norwalk CT 06854 T 3. Mr. Narayanan Viswanathan contacted following person and organization for RP: ⇒ The Ford Foundation, New York ⇒ Dr. Anne Stafford, University of Glasgow. Director University of Edinburgh, Deputy dinburgh, Director CREID 4. Mr. Vaibhav Mehta contacted Honduras student group alumni Ms. Melissa Sabillon. She responded by emails, providing deeper insights on the current socio-economic situation in economic Honduras and about the the education system in country. 5. Mr. Thomas Brian from University of Baylor who was involved with th the Village Green Incorporation in Honduran rural areas. He had established small hydroelectric power generators so that village houses could have electricity for daily use. Tuesday, Defining and The group met at 9:30 AM and started defining all 6th, validating uncertainties. We decided to do self assessment for our October uncertainties uncertainties and it should not be ambiguous and must 2009 be uncertain. By the afternoon we made uncertainties and their outcomes. Post lunch we started with making clusters. While making clusters, we realized something is going wrong in our clusters. We stepped back for a moment and saw that our uncertainties were ambiguous. The self-checking on ambiguity of uncertainties had not checking been successful. We started validating our uncertainties as a group and considered whether they were actually uncertain and were driving forces for change. We rewrote the ambiguous uncertainties and made new blue post it’s for the same. Scenario Investigation & Analysis – Iteration 2 5
  5. 5. Exploring International Business Environment Validating As soon as we completed validating uncertainties, we and naming started making clusters. Based on 1st iteration of clusters experience, we decided that each member of the team would work on separate clusters and will present on the connections to the group. Each member contributed in making cluster and validating them. making Every member presented his cluster and storyline to the team and, based on team decision, cluster was finalized. Wednesd Are we right We met up at 8:45 to built Impact and Predictability ay, 7th in naming the Matrix. In the mean time we realized to call Dr. Burt for October clusters? his comments on cluster names as this is critical for next 2009 stage. The team asked Dr. Burt for his views on the new clusters and their names. Dr. Burt reviewed the clusters and asked the team what are the driving forces in each the clusters. He asked the team to rework on names and get it rechecked by him in the afternoon. Based on Dr. Burt’s feedback, the team decided to rework on the cluster names. There was long discussion among the team members about the name for each team and every cluster. Impact and Post naming of the clusters, we started making the Predictability impact and predictability matrix Matrix- The team used voting method to reach on the Ranking the consensus for the rankings of each of the clusters clusters After completing impact and predictability matrix, we decided to call Dr. Burt for his feedback on final cluster names & how we had used our impact and Predictability Matrix. Dr. Burt encouraged us to use all our blue post-its when its we had framed our scenarios to ensure a rich storyline. Remarkable Concurrent with the impact and predictability matrix Person work, James McKenna contacted the Remarkable person. He interviewed Professor Sally Humphries discussing where we had reached in our research and our view of Honduran society with regard to the Millennium Development Goal’s, consolidated her feedback and discussed with the team. Scenario Investigation & Analysis – Iteration 2 6
  6. 6. Exploring International Business Environment Scenario For the Scenario Matrix we considered following Matrix clusters: Influence of US Policy on International trade of Honduras Role of judiciary in dealing with corruption and gang culture Reviewing both the clusters, each member of the team contributed at least 2 future outcomes for each scenario to start as a base for fr framing the scenarios scenarios. While making Scenario Matrix, Dr. Burt came to see our progress. He told us that the Scenario Matrix we built did not frame the information we have adequately. He told us to include the driving forces which lead to change in framing our scenario matrix. After this feedback we reviewed and changed our framing statements to ensure they covered the driving forces we had identified. Naming the The team came together and based on consensus Scenario naming was decided for all four scenarios Matrix The name of four scenarios are as follows: ⇒ Brown Field Development ⇒ Level Playing Field ⇒ Recipe for Revolution ⇒ Green Shoot in Shades Making The next task was to develop storyline for 4 scenarios. In Storylines order to do so team picked the outcomes resembling the statements of the scenario and included them in scenario. The team divided itself in making 4 storylines keeping the MDG goals of UNDP as a fixed point of reference. The team focused on making connections in the storyline and included Virtuous and vicious circles at the same time. Stakeholder The team appointed Chandra Shekhar and Sanil Narayanan Analysis Subash to carry out Stakeholder Analysis. Post his Viswanathan, analysis Narayanan, Viswanathan reviewed and Chandra included few missing links in the s same – which the team Shekhar and subsequently ratified ratified. Sanil Subash Scenario Investigation & Analysis – Iteration 2 7
  7. 7. Exploring International Business Environment Impact of The team created a matrix to give an overview to all Scenario’s on four scenarios and their impact in MDG goals. The MDG Goals matrix included 3 coding which are as follows: of UNDP Red- MDG goal not achieved Yellow- Yellow Probably Achieved Green- Green Achieved MDG goal In this matrix we showcased current scenario of the country and impact of MDG goals on of the country and impact of all scenarios on MD goals. MDG Thanks to the Venezuelan team for their idea. (All Rights Reserved) Presentation The Soft copy of every process was recorded by Narayanan Narayanan Viswanathan (NV). After discussing the Viswanathan impact of each scenario on MDG goals, NV started with final presentation. Audio-Visual The team contributed their views on building the Sanil & representatio presentation and formatting of the same. Vaibhav n of Sanil Subhash Chandra Bose and Vaibhav Mehta were Honduras involved in making Audio visual for the current scenario Audio-visual current of Honduras. The teams gave their feedback on the scenario audio-visual audio visual and were included in final presentation. Wednesd Final The team collated final Audio Video and final Audio-Video All ay, Presentation presentation and received feedback from all team 7th members October 2009 Thursday, The team appointed Narayanan Viswanathan and Narayanan, 8th James McKenna to present on Thursday 8th Oct’09. Viswanathan & October James 2009 McKenna Scenario Investigation & Analysis – Iteration 2 8
  8. 8. Exploring International Business Environment Day/ Date EIBE Subject - What What actions do we take to address? Action by? do we not know? Points of General Reflection After the iteration-1 we decide to have an open 1 critical feedback session among the members of the group. reflection on Lesson from This feedback is for each member by other members EIBE Process Iteration-1: from the group. This shown a new picture of our self. Because there was big difference of what we think of our self and how we are perceived in the group. Each of us noted down our feedback and kept in mind to change our self for second iteration. The beautiful thing was each of us has accepted the feedback without giving any explanation o “if’s or of but’s”. We accepted it as a gift and promised to . bring necessary changes so that we can really value add in second iteration. Lessons from Group management of learning styles was a key Iteration-2: factor. Having an open feedback session after iteration 1 helped us to come together as a group All members of group being assertive are necessary for a healthy discussion. It’s more important to judge when to step back than to step ahead. Taking timely breaks for refreshing the thought process is important for new idea generation as well as for letting off some steam. Listening to others is the key for introspection. Self management is more important than time management. No idea is good or bad It’s important at times to challenge your assumptions from your research. It is better to include a person who has better experience may be like 10 or more years the way they approach the problem is entirely different. If the team contain more than 2 activist try to be a reflector or pragmatist even if you are activist. u Have we utilized Frankly speaking No. From the day 1 onwards we with our time had timetable for each & every process that we had effectively? to do. But unfortunately we were not able to meet e the deadlines time-and-again. Consequently, we . extended our working time – of working from 9 a.m. till late at night. We have 2 people who had to leave by 10 p.m. since they are staying far away from Glasgow. We used technology to overcome this issue by getting in touch with each other and enable virtual group working by using Skype. Scenario Investigation & Analysis – Iteration 2 9
  9. 9. Exploring International Business Environment 2. Honduras – An Overview verview Data Source(s) http://www.unsiap.or.jp http://www.ifad.org http://www.wri.org http://www.hondurastips.honduras.com History Honduras was originally inhabited by indigenous tribes, the most powerful of which were the Mayans. The western-central part of Honduras was inhabited by the Lencas. These autonomous central groups had their conflicts but maintained their commercial relationships with each other and with other populations as distant as Panama and Mexico. On July 30, 1502, Christopher Columbus first saw Honduran soil and he claimed the territory in the name of his sovereigns, Ferdinand of Aragon and Isabella of Castile. He named the area "Honduras" (meaning "depths") for the deep water off the coast. Honduras, which was colonized by Spain, gained independence in 1821. The country was then briefly annexed to the Mexican Empire. In 1823, Honduras joined the newly formed United n Provinces of Central America federation, which collapsed in 1838. The country has been in and out of Democratic and Military rule in succession, and not necessarily iin any particular order. n Political Scenario Organized labor represents approximately 8% of the work force and its economic and political influence continues to decline. Honduras held its seventh consecutive democratic general elections in 2005 to elect a new president, unicameral Congress, and mayors. For the first time, as a result of ew the newly reformed Electoral Law, voters were able to vote for individual members of Congress, with photos of each candidate on the ballot, rather than party lists. For the electoral period 2006-2010, 31 women were elected to Congress. Additionally, 27 of these 31 2010, congresswomen chose women as their alternates. In November 2008, successful primaries were held to select the candidates from the Liberal and National parties who will compete for the presidency in November 2009. The two major parties are the slightly left left-of-centre Liberal Party and the slightly centre slightly-right-of-center National Party. The three much smaller registered parties the Christian Democratic Party, the parties--the Innovation and National Unity Party, and the Democratic Unification Party hold a few seats each in n Party--hold the Congress, but have never come close to winning the presidency. Government ⇒ Type: Democratic constitutional republic Independence: September 15, 1821 ocratic ⇒ Head of State: President, directly elected to 4 resident, 4-year term ⇒ Political parties: Partido Nacional Partido Liberal, Innovation and National Unity Party, Nacional, , Christian Democratic Party, and the Democratic Unification Party. The following is the list of Head of the State of Honduras from 1933 to date. ⇒ Chairman of the Military Junta PN: National Party PLH: Honduran Liberal Party ⇒ Tiburcio Carías Andino 1933 1933-1949 (+1969) PN ⇒ Juan Manuel Gálvez Durón 1949 1949-1954 (+1955) PN ⇒ Juan Lozano Díaz 1954-1956 (+1957) PN 1956 ⇒ Roque Jacinto Rodríguez Herrera 1956 ríguez 1956-1957 C.MJ, military (1) ⇒ Ramón Villeda Morales 1957 1957-1963 (+1971) PLH ⇒ Oswaldo López Arellano 1963 1963-1965 C.MJ, military Scenario Investigation & Analysis – Iteration 2 10
  10. 10. Exploring International Business Environment ⇒ Oswaldo López Arellano 1965 1965-1971 PN ⇒ Ramón Ernesto Cruz Uclés 1971 1971-1972 (+1985) PN ⇒ Oswaldo López Arellano 1972 1972-1975 military ⇒ Juan Alberto Melgar Castro 1975 1975-1978 (+1987) military ⇒ Policarpo Paz García 1978 1978-1980 C.MJ, military (2) ⇒ Policarpo Paz García 1980 1980-1982 civilian (caretaker) ⇒ Roberto Suazo Córdova 1982 1982-1986 PLH ⇒ José Azcona Hoyo 1986-1990 PLH 1990 ⇒ Rafael Leonardo Callejas Romero 1990 1990-1994 PN ⇒ Carlos Roberto Reina Idiáquez 1994 1994-1998 PLH ⇒ Carlos Roberto Flores Facussé 1998 1998-2002 PLH ⇒ Ricardo Maduro Joest 2002 2002-2006 PN ⇒ José Manuel Zelaya Rosales of the PL 2006-2009 o Has been ousted in a coup supported by Military 1956-1957 Military Junta members: Roberto Gálvez, Roque Jacinto Rodríguez Herrera, Héctor Carraccioli 1957 1978-1980 Military Junta members: Policarpo Paz García, Amílcar Zelaya Rodríguez, Domingo Álvarez Cruz 1980 Economy Honduras, with a per capita gross national income of $1,635, is one of the poorest countries in the Western Hemisphere. Historically dependent on exports of agricultural goods, the Honduran economy has diversified in recent decades and now has a strong export export-processing (maquila) industry, primarily focused on assembling textile and apparel goods for re re-export to the United States, as well as automobile wiring harnesses and similar products. These industries employ about 130,000 Hondurans, out of an economically active population of 2.8 million. Despite the recent population economic diversification, there continues to be a large subsistence farmer population with few economic opportunities. Honduras also has extensive forest, marine, and mineral resources, although widespread slash-and-burn agricultural methods and illegal logging continue to destroy burn Honduran forests. Remittances from Hondurans living abroad, record for more than one-fifth of GDP fifth GDP--but the annual rate of growth of remittances has been slowing down consistently from 2006 and is expected to turn negative in 2009. Meanwhile, Honduras's fuel import bill rose sharply with the surge in world oil prices (Honduras produces no petroleum), and foreign reserves of the Central Bank fell by nearly $98 million--about 4%. Reserves continued to decline during 2008 and by November equalled just over about three months worth of imports. Since 2005, Honduras has received nearly $4 billion in debt relief from bilateral and multilateral donors. The Government of Honduras has committed to apply these funds to poverty alleviation, as rnment laid out in the existing Poverty Reduction Strategy. However, much of the ensuing rise in government spending has gone to public sector salaries and fuel subsidies. Fuel subsidies were phased out and subsidies electricity subsidies reduced and targeted more tightly to the poor in 2008. But salaries, especially for teachers, continue to claim an increasing share of public spending. Economy (2007 estimate) ⇒ GDP: $12.3 billion o Manufacturing (19.7% of GDP) o Services (54.2% of GDP) o Agriculture (13.8% of GDP) Scenario Investigation & Analysis – Iteration 2 11
  11. 11. Exploring International Business Environment ⇒ Growth rate: 6.3% ⇒ Per capita GDP: $1,635 (official exchange rate) $3,130 (PPP, IMF) ⇒ Trade – Exports: $5.59 billion o Major market--U.S. (70%) U.S. ⇒ Trade Imports: $8.56 billion o Major source--U.S. (52%) U.S. Geography & Topography ⇒ Area: 112,090 sq. km. (43,278 sq. mi.); slightly larger than Virginia. ⇒ Cities: Capital--Tegucigalpa ( Tegucigalpa (population 1,150,000); San Pedro Sula (population 900,000) an ⇒ Climate: Tropical to subtropical, depending on elevation ropical, ⇒ Population: 2006 est.: 7.3 million Growth rate (2006 est.): 2.16%. ⇒ Ethnic groups: 90% Mestizo (mixed Indian and European) estizo ⇒ Religions: Roman Catholic, Protestant minority – Language: Spanish n ⇒ Education: Attendance-88% overall, 31% at junior high level. Literacy--76.2% 88% 76.2% ⇒ Health: Infant mortality rate rate--29.64/ 1,000. ⇒ Life expectancy: 66.2 years ⇒ Work force: o Services - 42.2% o Natural resources/agriculture - 35.9% atural o Manufacturing - 16.3% o Construction/ Housing - 5.6% ousing Population living with under $1 a day (%) 23.8 Population living with under $2 a day (%) 44.4 Undernourished people (% or population) 21.0 Children under 5, underweight for their age (%) 25.0 Children under 5, under height for their age (%) 39.0 Probability of not surviving to age 40 (% of cohort) 13.8 Population without sustainable access to an improved water source (%) 12.0 Foreign Relations Honduras is a member of the United Nations, the World Trade Organization (WTO), the Organization of American States (OAS), the Central American Parliament (PARLACEN), the Central American Integration System (SICA), the Conference of Central American Armed Forces (CFAC), and the Central American Security Commission (CASC). Honduras is also a signatory to the Rio Pact and a member of the Central American Defence Council (CONDECA). Honduras is a strong proponent of Central American cooperation and integratio and continues to integration, work towards the implementation of a regional customs union and Central American passport, which would ease border controls and tariffs among Honduras, Guatemala, Nicaragua and El Salvador. Scenario Investigation & Analysis – Iteration 2 12
  12. 12. Exploring International Business Environment 3. Identification of Uncertainties (Sheet 2) Areas of investigation & the corresponding Uncertainties Cultural ⇒ Access of hospitals in rural areas areas. ⇒ Change in Garifuna culture by tourism tourism. ⇒ Effects of Cultural value system on Education Education. ⇒ How does the Catholic Church change the Human Rights record of Honduras? ⇒ Impact of awareness of condoms on male prostitutes prostitutes. ⇒ Impact of awareness on conservation of treestrees. ⇒ Impact of cultural attitudes on women’s employment and empowerment empowerment. ⇒ Impact of free health check up’s of pregnant woman on infant mortality rate rate. ⇒ Impact of legalized prostitution on HIV HIV. ⇒ Influence of women for decision making regarding the use of condoms condoms. ⇒ Is working environment equal for men and women in private sector sector. ⇒ Role of catholic churches in politics politics. ⇒ Role of rural society towards modern maternity centre ural centre. ⇒ Women employability in private sector sector. Ecological ⇒ Ability of Honduras to develop eco eco-friendly tourism. ⇒ Efficiency of the Honduran government in chalking out an ecological policy on mining mining. ⇒ Impact of forest conservative law on new crop sustainability sustainability. ⇒ Impact of growing rate of urbanization on the eco system and natural resources eco-system resources. ⇒ Impact of new ecological act on Shrimp farming farming. ⇒ Role of wheat and rice farming on malnutrition of children in rural area. area. Economic ⇒ Competition of Maquila products with Asian products in USA USA. ⇒ Creation of special economic zones and providing short term Tax rebates short-term rebates. ⇒ Does corruption lead to decline in GDPGDP? ⇒ Does microfinance contribute to the economy? ⇒ High interest rate on loans, affecting child education. ⇒ Impact of tourism on child education education. ⇒ Increase in tourism affecting real estate price price. ⇒ Role of microfinance on entrepreneurs in urban population population. ⇒ Strategic alliance with gold companies to dig gold in Honduras Honduras. ⇒ What will Honduras do if oil is found in territorial waters waters. ⇒ Will the fishing Industry on the East Coast of Honduras continue to be a net exporter? Environmental ⇒ Effectiveness in the flood management between Honduras & Nicaragua Nicaragua. ⇒ Government’s stance on environmental conservation. ⇒ If Hydro electric dams are not built, how will rural community’s energy needs be met? ⇒ What effects would a renewed mining industry have on the environment? ⇒ Will focus on preventative health campaigns have an impact on Changes disease? Scenario Investigation & Analysis – Iteration 2 13
  13. 13. Exploring International Business Environment Ethics ⇒ Does increase in tourism leads to increase in prostitution prostitution. ⇒ If judicial system not influenced by executive body what impact would there be on corruption. ⇒ Impact of Censorship on the Honduran TV and News papers. ⇒ Impact of impunity before the legal system for the social elites on the human rights index index. ⇒ What will the Catholic Church do to affect the lives of under nourished children? Geo-Politics ⇒ Does World Bank project for energy alleviate energy crisis in Honduras? ⇒ Feasibility of strategic alliance with foreign universities to create skilled manpower ⇒ Impact of development of trade relations with countries outside US and Latin America ⇒ Impact on Honduran government with removal of US army from Solvano airbase ⇒ Nature and impact of the decrease in military forces ⇒ Political impact of Honduras joining ALBA ⇒ Political instability can lead to loss of investment by US companies ⇒ The rigid rule by US for Illegal immigrants from Honduras ⇒ What effect will Central American Free Trade talks have on Honduras? ⇒ What will be the consequences on oil supply due to Honduras’s political stance? ⇒ What will be the impact of the oil oil-deal with Venezuela ⇒ What will be the USA policy on convicted Hondurans in the USA illegally? ⇒ What will Honduras Governments foreign policy be towards its nearest neighbours? be ⇒ What would be the effect of the re re-formation of the “Coffee Cartel”? ⇒ Will the UN intervene in the current political unrest? Law ⇒ Does government labelling of trees reduce illegal timber production? ⇒ Does minimum wages of children curb child labour? ⇒ Effectiveness of the enforcement of judicial systems and the rule of law law. ⇒ Implementation of anti-gang law on freedom of youth gang youth. ⇒ Is judiciary influenced by politics? ⇒ Will the Judiciary continue to be linked t the Political systems? to Macro-Economical ⇒ Exploration of minerals to increase GDP GDP. ⇒ Feasibility of having separate quota for women in public sector jobs who complete primary education. ⇒ How could the EU trade Negotiations affect Honduras agricultural policy? ⇒ Impact of change in USA free trade policy on Honduras export export. ⇒ Impact of EU trade agreement on Honduras export export. ⇒ Impact of global credit crunch on the Tourism industry industry. ⇒ Impact of implementation and adaptation of CAFTA DR on foreign direct investments CAFTA-DR investments. ⇒ Impact of industrialist buying property on beaches beaches. ⇒ Impact of promotion of inland railways for transportation of goods and people, by improving the current infrastructure. ⇒ Impact of strategic alliances and partnerships between dependent industries on dom domestic market scenario. ⇒ Impact of transmission of Maquila sector to manufacturing sector on economy economy. ⇒ Impact on unskilled labours due to minimum wage standard standard. Scenario Investigation & Analysis – Iteration 2 14
  14. 14. Exploring International Business Environment Macro-Economic ⇒ Is increase in child mortality an impact of de centralized hospital system? de-centralized ⇒ Opening up Puerto Corte’s port for handling merchandize beyond El Salvador and Nicaragua. ⇒ PL regaining power in General elections elections. ⇒ Role of gangs in slowdown of economy economy. ⇒ What effects will textile import policy of the USA have on the Honduran economy? ⇒ What will be the impact of credit crunch in US on Honduran economy? ill credit-crunch ⇒ What will happen to Power supplies if State companies are sold to the private sector? ⇒ Will the Maquila business model develop to cope with recession in the USA? Political ⇒ Ability of the government to procure more drugs for HIV through negotiation with pharmaceutical companies companies. ⇒ Ability of the Honduran government to improve the road infrastructure infrastructure. ⇒ Ability to generate adequate professionals dedicated to manage HIV HIV. ⇒ Effect of the coup on the democratic set set-up of the country. ⇒ How effective is water sanitation project in rural areas? ⇒ If unemployment rates stay at historical levels, what effects will this have on primary education? ⇒ Impact of labour unions in providing quality education education. ⇒ Partido Nacional party coming to power, in the next general election ido election. ⇒ Prioritizing the allocation of funds towards infrastructural development development. ⇒ Utilization of health care budget in research and technology of new medicines medicines. ⇒ Impact of introduction of monitoring of HIV status of Legal sex workers on HIV prevention ⇒ Impact of trade union on domestic politics politics. ⇒ Role of small parties in general election in November 9 9. ⇒ Will the government provide free primary health care in the rural areas? health-care Social ⇒ Ability of existing education system in producing skilled labour. ⇒ Ability of the local News paper and TV to impact Political Change Change. ⇒ Ability of the UN AIDS to collaborate with NGOs working on HIV prevention. ⇒ Change in Attitude of religious groups to providing sex education in schools providing schools. ⇒ Feasibility of giving free mosquito net by government to prevent malaria malaria. ⇒ How effective is role of NGO’s in spreading the message “Feed a child in Honduras”? ⇒ Impact of cooperation between regional municipalities on Health resources / learning resources learning. ⇒ Impact of cultural diversity on acceptance health care delivery delivery. ⇒ Impact of literacy on women empowerment empowerment. ⇒ Impact of NGO in creating awareness regarding HIV prevention prevention. ⇒ Impact of training Nursing Auxiliaries on infant mortality mortality. ⇒ Role of NGO’s in improving standard of living in rural areas O’s areas. ⇒ Stance of the Poor towards government providing free education. ⇒ What will happen to remittance incomes? ⇒ Will Changes in agricultural policy be influenced by companies like Wal Wal-Mart? ⇒ Will Gangs (MARAS) impact national Security? ⇒ Will population demographics continue to move to an urban setting? ⇒ Will the level of Maternal Care stay at current levels? ⇒ Women headed business sustain sustaining family!? Scenario Investigation & Analysis – Iteration 2 15
  15. 15. Exploring International Business Environment Technological ⇒ Ability of government to curb loss of energy in transmission and distribution distribution. ⇒ Ability of Honduras to develop BioBio-fuel. ⇒ Adaptation of latest techniques and technologies for agricultural development across the country. ⇒ Change in agricultural crop type – diversifying/ growing new crops. ⇒ Exploration of alternative sources of energy energy. ⇒ Possibility of exploring highly precious metal like zinc, silver in Honduras Honduras. ⇒ Internet connection facility impact on child education in rural area area. ⇒ Role of female condom on HIV/AIDS spread spread. Scenario Investigation & Analysis – Iteration 2 16
  16. 16. Exploring International Business Environment 4. Plausible Alternative Outcomes (Sheet 3) Uncertainties Plausible Outcome A Plausible Outcome B Effect of the coup on the Lack of public faith on There will be an increased democratic set-up of the democratically elected national and international focus country. government decrease their on free and fairness of the next confidence on democracy as a general election in the country whole Effectiveness of the Ineffective enforcement may Unchecked authority for law enforcement of judicial result in devolution of law & order enforcement may result in systems and the rule of law. situation in the country human rights violation committed by police and other inland security agencies Adaptation of latest Improved agricultural Excessive usage may result in techniques and productivity resulting in reduction infertile land or contamination of technologies for agricultural in food scarcity and promotion of agricultural produce development across the rural development country. Prioritizing the allocation of Allocation of funds towards Higher % of fund allocation on funds towards infrastructural domestic infrastructure infrastructure development development. development promotes trade, means less fund available for resulting in economic providing education and p public development health Creation of special Promotes entrepreneurship and Adversely impacts the inflow of economic zones and reduces brain drain revenue in the form of direct providing short-term Tax taxes for a short term rebates. Government’s stance on Effective environment policy will Stringent environmental policies environmental positively impact growth and may stunt the growth of tourism conservation. sustenance of economic and other similar sectors or will development increase their operational cost costs Change in agricultural crop Growing staple crops (such as Farmers currently growing cash type – diversifying/ growing Rice/ Wheat), will result in self self- crops such as Coffee, will need new crops sufficiency and reduce imports help and training to help th them diversify in staple crops Role of NGO’s in improving Disproportionate development Effective utilization of funds for standard of living in rural due to limitation of scale and development of rural areas areas. resources Impact of strategic Fosters symbiotic growth and May result in a paradigm shift alliances and partnerships development of the industries from Consumerism to between dependent and promotes healthy Producerism industries on domestic competition between them market scenario. Impact of implementation Eliminates the need of foreign Promotes fairness and and adaptation of CAFTA- firms to act through local agents transparency in government DR on foreign direct to participate in public tenders procurement procedures ent investments. resulting in increased FDI resulting in reduced corruption Impact of global credit There may be a lower inflow of An opportunity to consolidate the crunch on the Tourism tourists adversely impacting the tourism industry and formulating industry. tourism industry policies regulating eco cies eco-tourism Scenario Investigation & Analysis – Iteration 2 17
  17. 17. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B Impact of trade union on Government policies favoured Good representation of domestic politics. and biased towards specific businesses and industries in lobbyists only government will facilitate industrial reforms What will be the impact of Lower inflow of aids and Strained relationship with US the oil-deal with development funds from US resulting in impact on Maquila Venezuela? Nature and impact of the Decrease in military/ armed Decrease in armed forces result decrease in military forces. forces can pose a threat to in reduced spending on military, national security which can then be used for development projects What will be the impact of Slow down in US will adversely Weakness of US economy will credit-crunch in US on impact both demand for exports impede investment slowing down Honduran economy? and flows of remittance which economic growth account for 1/5 of Honduran GDP Impact of promotion of Reduced freight charges resulting Possibility of incurring more loss for inland railways for in increased profit margin for the government due to transportation of goods and business entities - Promotes trade increased pospossibilities of theft of people, by improving the railway tracks current infrastructure. Opening up Puerto Corte’s Improvement in political & Increased revenue and ability to port for handling economic relationship with reach capacity utilization of the merchandize beyond El neighbouring countries Puerto Corte port Salvador and Nicaragua. Partido Nacional party PN leaders will focus on getting PN government will adopt harder coming to power, in the tough on crime and in creating stance on wages and spending next general election. hospitable climate for business cuts in response to pressure from will benefit Honduras in the long IMF, rather than revenue run enhancement policies to reduce fiscal deficit Exploration of alternative Reduces dependencies on fossil Higher cost of initial capital sources of energy. fuel and import of crude oil investment resulting in less funds available to address other pressing needs Impact of growing rate of Encroachment of agricultural Increase in pollution resulting in urbanization on the eco- lands for townships resulting in deterioration of health system and natural food shortage in the long run resources. Impact of impunity before Increase in social unrest, resulting Oppression of economically and the legal system for the in higher crime rate and human politically weaker communities in social elites on the human rights violation the society resulting in social rights index. imbalance and Plutocracy Will the government provide Higher cost of initial investment of Reduces per capital expenditure free primary health-care in infrastructure with no immediate and mortality rates in the the rural areas? returns medium-long terms long Impact of cultural attitudes Women being isolated and Social imbalance created due to on women’s employment increase in likelihood for them lower percentage of women and empowerment. becoming easy targets for sexual employed in high high-skilled jobs harassment at work Scenario Investigation & Analysis – Iteration 2 18
  18. 18. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B Impact of change in USA Relationship of Honduras Honduras focuses on other free trade policy on increases with Venezuela. countries for export. Honduras export. Competition of Maquila Change in Maquila products to Maquila products focused in products with Asian establish identity in USA market. other markets. products in USA. Implementation of anti Youth frustration leads to rejoin in Strict implementation of law gang law on freedom of gang. curbs the gangs. youth. Impact on Honduran High funding by USA to Honduran Longer US--Honduran relation to government with removal government for maintenance of sustain growth. of US army from Solvano army. airbase. Role of microfinance on Increase in employment in both Increase in investment for entrepreneurs in urban urban and rural population. business infrastructure. population. Role of rural society towards Proximity of Maternity centre will Less response to maternity centre modern maternity centre. help women health. by women due to conservative nature of women. Role of small parties in Influence gangs to increase their Gangs will combine with PN to general election in vote banks in election. overpower PL in general election. November. High interest rate on loans, Parents send child to work Increase in child labour. affecting child education. instead of school to repay the loan. Impact of EU trade More revenues coming from EU More employment opportunities agreement on Honduras market as exports. helping in eradicating poverty. export. Role of female condom on Decrease in HIV/AIDS numbers in Increase in HIV/AIDS number in HIV/AIDS spread. Lesbian and heterosexual male to male sex partners. partners. Impact on unskilled labours Secure bread basket for the local Improvement in financial due to minimum wage labours every day. conditions of the unskilled standard. workers. Role of wheat and rice Less dependency on government Less impact of diseases as farming on malnutrition of aid leading to continuous food children are healthy with children in rural area. supply to children. sufficient food supply. Impact of literacy on Higher role in family affairs Better self- -awareness leading to women empowerment. leading to gender equality. better maternal health. If judicial System not Though Judicial system Judicial System takes action Influenced by executive separated from the executive against corruption severe body what impact would body Corruption not affected. decrease in corruption seen there be on corruption. Impact of labour unions in Labour union work towards better Labour union keeps on calling providing quality education. working condition for teacher strikes for teachers school which results in better quality of intermittently closed for long education periods of time. iods Ability of existing education Existing education system Though 95% literacy achieved system in producing skilled produced high quantity of the degree has no value in the labour. professionals / Skilled labour. job market. Scenario Investigation & Analysis – Iteration 2 19
  19. 19. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B Stance of the Poor towards The poverty prevailing in The poor are not concerned Government Providing free Honduras sees free primary about education they see it as a Education. education as the first step in factor that would decrease Alleviating Poverty house hold income Effects of Cultural value Overall high level of acceptability Although high level of system on Education. of need for education acceptability of need for education rejection of Organized schooling. Ability of the local News Media makes govt more Political control on media makes paper and TV to impact accountable for their actions them tools for party Political Change. propaganda.8 Ability of Honduras to Honduran Govt was able to Honduras spends 20 M US$ on develop Bio Fuel. develop bio fuel from Sugarcane research however no new bio and African Palm to meet the fuel developed 33% requirement budgeted by them Impact of Censorship on The Govt censor board weak Government censors any Anti the Honduran TV and News media speaks its mind on political government material on the local papers. action TV and News. Efficiency of the Honduran The Government of Honduras in Eco friendly mining laws ( Govt in chalking out an deadlock over coup Eco-friendly formulated) though delayed ecological policy on mining act is shelved mining. Will Gangs (MARAS) impact Gangs grow in size high impact Cultural rejection of MARAS national Security? on national security decreasing impact on MARAS Impact of new ecological Decreased production and The new law does not impact act on Shrimp farming. export of shrimp shrimp farming practices practices. Ability of Honduras to The Honduran Govt in support Tourism Industry booms however develop eco friendly with IADP develops a plan fo for the ecological laws are not tourism. eco-friendly tourism eco adhered to. Ability of the Honduran Honduras develops and repairs The road infrastructure remains Govt to improve the road existing road structure decrease the way it is, status quo on oil infrastructure. in transit times and improved consumption from transport. efficiency on oil consumption Ability of Government to Energy losses continue as poor Private sector kicks in on energy curb loss of energy in infrastructure. well managed plants with transmission and distribution. minimal losses of energy in transmission. Change in Attitude of Though religious leaders against Religious Institution remains religious groups to providing introduction of sex education conservative towards introducing sex education in schools. Government Introduces it in sex education in primary school. Primary School Impact of NGO in creating NGOs work in HIV prevention in a NGOs actively piece meal and awareness regarding HIV major way reaching out to the there is no follow follow-up prevention. highly Susceptible population Ability of the UN AIDS to UN AIDS work in collaboration NGOS feel threatened by UNAIDS collaborate with the NGOs with all NGOs working on a work in terms of loosing working on HIV prevention. systematic national plan to independence. control HIV. Scenario Investigation & Analysis – Iteration 2 20
  20. 20. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B Impact of introduction of Legal sex work not monitored Recognition and monitoring of monitoring of HIV status of resulting in no change on health this group leads to tab on HIV Legal sex workers on HIV status of Sex Workers. status amongst sex workers and prevention. improved awareness levels. Impact of training Nursing Trained Auxiliary staff goes back Trained Auxiliary staff though Auxiliaries on infant to the community advocating assist in deliveries but have no mortality. and assisting in studded impact on changing mindset deliveries. towards institutionalized deliveries Impact of cooperation Cooperation between Though there is a sharing of between regional municipalities learning from each managerial processes no sharing municipalities on Health other shared resource base of resources as they are limit limited. resources / learning. specially effects smaller municipalities Impact of cultural diversity Culturally diverse groups not Culturally diverse groups more on acceptance health care receptive of modern day acceptable of taking assistance delivery. medicine in Health from trained members of their own community Ability of the Government Government manages to Failure / Delay in payment lead to procure more drugs for continue and further subsidize to spoilt relationship with HIV through negotiation procurement of drugs from pharmacy companies and in with pharmaceutical pharmaceutical companies procurement of new drugs. companies. Ability to generate The municipal Government calls Govt looks at buil building training adequate professionals on local resources training others facilities for provision of skilled dedicated to control HIV. within the community manpower to deal with HIV care Does increase in tourism More sexual transmitted disease Sex tourism reason for more leads to increase in among people tourist to coming in prostitution. Increase in tourism affecting Real estate price goes up More infrastructure development real estate price. Does corruption leads to Corruption may sometimes leads Country GDP will decline decline in GDP. to consumerism Effectiveness in the flood Information generated was rarely Dispute between Nicaragua & management between translated into early flood Honduras leads to falsification of Honduras & Nicaragua. warning data in the case of disaster Feasibility of giving free Because of centralized health Since majority of population are mosquito net by care system (Hospitals) in urban areas distribution government to prevent distributing mosquito net though feasibility is high which can malaria. hospitals in not a good idea prevent malaria spreading Does microfinance More women in business More business start up thereby contribute to the economy. better GDP Does minimum wages of Primary education rate increase Rise of gangsters among young children curb child labour. age people decrease Strategic alliance with gold Increase in gold export add more Lack of skilled labour in Honduras companies to dig gold in value to the economy may be problem to maintain Honduras. mining plant Is judiciary influenced by Legal system fails increase in Increase in number of crimes politics. corruption Scenario Investigation & Analysis – Iteration 2 21
  21. 21. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B Feasibility of strategic Foreign university education Due to poverty people might not alliance with foreign might be expensive be interested in higher education universities to create skilled manpower. Is increase in child mortality Lack of doctors is a problem More life span among children an impact of de-centralized hospital system? Feasibility of having Government of Honduras unable Women empowerment their by separate quota for women to give salaries to employees family stability in public sector jobs who complete primary education. Women headed business Better gender equality Improved women education sustains family. Does world bank project for Energy exploitation may happen Rural areas getting electrified energy alleviate energy crisis in Honduras. How effective is water Decrease in death rate due to Better health for people in rural sanitation project in Rural impure water areas areas? How much possible is Youth contributing more to the Increase in primary education inculcating agriculture economy resulting in less crime and poverty education in primary education? How effective is role of Educational & social uplift NGO’s are not able to convey NGO’s in spreading the increase among children message to the world “Feed a message “Feed a child in decrease in poverty child in Honduras” Honduras”? Does government labelling Tagging or labelling of all trees De-forestation can be reduced forestation of trees reduce illegal are not feasible which iin-turn up to an extent timber production? illegal cutting of trees Possibility of exploiting highly Maintenance of mining plant will Lead & zinc export will add better precious metal like zinc, be harder because lack of skilled value to country silver in Honduras. man power The rigid rule by US for Illegal Illegal immigrants of Honduras Increase in unemployment due immigrants from Honduras. sent back to their countries to more eligible people for one job Impact of awareness of Usage of condoms increases in Population control is done with condoms on male males sex with male workers high usage of condoms prostitutes. leading to decrease in HIV Influence of women for Use of condoms increases due to Reduction in chances of HIV due decision making regarding more influence of woman in to increase in use of condoms the use of condoms. purchasing process Impact of free health check Better health of children when Backward society opposing up’s of pregnant woman on born health check up due to social h infant mortality rate. norms PL regaining power in Amendments in judiciary laws Quality of education enhanced General elections. by involving professional teachers from abroad Scenario Investigation & Analysis – Iteration 2 22
  22. 22. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B Is working environment More employment opportunities Disparity in income for women in equal for men and women for women in private sector private sector despite same in private sector. qualification Utilization of health care Special budget assigned for More advance techniques/ budget in research and research in health care vaccination been used to cure technology of new current diseases medicines. Impact of industrialist People with less income selling off Growth of hospitality industry in buying property on their lands with less value of their Honduras near beaches beaches. lands Exploration of minerals to Export of minerals leading to Burden on few minerals will be increase GDP. increase in GDP reduced as there will be market for more minerals Impact of transmission of Manufacturing of products will Foreign trade will increase due to Maquila sector to less production of goods which to be manufacturing sector on sold in different countries economy. Impact of development of Dominance of US will be reduced US will take action against trade relations with Honduras because of trade countries outside US and relation with their countries Latin America. Role of gangs in slowdown Involvement of gangs in robbery Gangs involvement in politics of economy. and murder leading to de growth leading making laws in favour of of econ economy them Impact of awareness on Deforestation reduces with Conservation of trees leading to conservation of trees. increase in awareness healthier environment for future Women employability in Low wages given to women Woman faces sexual harassment private sector. compared to men of same in office calibre Access of hospitals in rural Limited access of hospitals in rural Accessibility of hospitals to rich areas. areas people Impact of legalized Growth of tourism leading to high People moving out of poverty prostitution on HIV. GDP Political instability can lead US companies removing their Increase in unemployment due to loss of investment by US business from Honduras to US companies removing their companies business Political impact of Honduras Strong alliance among members Strong alliance leading to joining ALBA. leads to more trade reduction in US decision making in Latin America Role of catholic churches in Influence of catholic churches fluence Influence of catholic church politics. increases as its followers increases leads to amendment to constituency laws What will be the Venezuela supply of oil and Venezuela continues to supply oil consequences on oil supply political links are strengthened but does not require A.L.B.A. due to Honduras’s political within A.L.B.A. membership as a political pre pre- stance? requisite. Scenario Investigation & Analysis – Iteration 2 23
  23. 23. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B How could the EU trade E.U. Trade negotiations result in E.U. trade negotiations result in Negotiations affect new markets for all agricultural new markets for Agricultural Honduras agricultural output and nothing more. output & foreign direct policy? investment in sustainable manufacturing. What will be the USA policy USA Continues with repatriation USA agrees to keep Honduran on convicted Hondurans in of Honduran convicts. convicts in American penal the USA illegally? system until end of sentence. If Hydro electric dams are Rural communities continue to Rural communities are helped by not built, how will rural rely on Kerosene for electricity NGO's to utilize small scale local community’s energy needs generation. hydro-electrical systems. electrical be met? What Will happen to Power The selloff of Public Power The selloff of Public Power supplies if State companies Generation companies creates a Generation companies does not are sold to the private more competitive energy market create a competitive market for sector? for consumers. consumers but revenue made from the sale is re om re-invested in electrical infrastructure. What will Honduras do if oil A National Oil Company is A National Oil Company is is found in territorial waters? formed which works in formed with links to Venezuela partnership with International Oil and other A.L.B.A. Countries. Companies. What will Honduras Work with Geographic Work with A.L.B.A. as a primary Governments' foreign policy neighbours in O.A.S. & CAFTA group member including military be towards its nearest with no Military agreements. consequences. neighbours? Will the UN intervene in the U.N. intervenes and helps return U.N. Intervenes & advocates current political unrest? Honduras to the current state of constitutional change on the way political stability. to returning state to democratic control, helping separate Judicial from political. Will the Judiciary continue The Judiciary are not appointed The Judiciary continue to be to be linked to the Political by political parties but are linked to political parties systems? accountable to the people Will the Maquila business Maquila production becomes Maquila production diversifies model develop to cope uneconomic - leading top a into a different model, and with recession in the USA? reduction in working women. creates more job opportunities for Women. What effects will textile USA Policy will no longer support Textile manufacture continues to import policy of the USA textile manufacture. Selling to be supported from the US. have on the Honduran E.U. covers shortfall. economy? Will changes in Agricultural Honduras Agriculture becomes a Agricultural policy is aimed at Policy be influenced by more integrated part of domestic staples with cash crops companies like Wal-Mart? American food supply chain and as a secondary objective. is supported by agricultural policy Will population Agricultural, Mining & Tourism People continue to move to demographics continue to encourage higher wages in rural urban areas .Development of move to an urban setting? areas, toping labour movement industrial centres around the 4 to the cities. Special economic main urban areas’ due to zones drive this. infrastructure and power demands. Scenario Investigation & Analysis – Iteration 2 24
  24. 24. Exploring International Business Environment Uncertainties Plausible Outcome A Plausible Outcome B How does the catholic The Catholic church does not The Catholic Church Actively church change the Human intervene at a country level protests at a country level for Rights record of Honduras? regarding political systems but human rights to be respected. concentrates at local level to address injustices. Will the fishing Industry on The Fishing industry maintains its Fishing Industry maintains catch the East Coast of Honduras catch sustainably. Cash Crop for at sustainable levels 7 resource is continue to be a net Export to USA. used to keep Honduran poor fed. exporter? What effect will Central The CAFTA Agreement increases The CAFTA Member increases American Free Trade talks cash crop production towards prices to USA & Europe, some have on Honduras? USA & Europe. land reclaimed for domestic food supply security. What effects would a Increased mining activity resulting Increased mining activity resulting renewed mining industry in increased employment but in increased employment and have on the environment? conflicting with Nature reserves export revenue. for tourist/ecological revenues. What will happen to If Remittance incomes increase If the remittance incomes remittance incomes then families will be able to be increase then there are more better nourished & Educated drivers to leave family and move leading to less gang to the US illegally - results in more membership. gang memmembership. What will the catholic Catholic church focuses on Catholic Church Focus on church do to affect the lives education of the poor to break feeding the poor via charity and of under nourished the poverty cycle. working with N.G.O.'s. children? Will the level of Maternal Maternal Care stays at these Maternal Care is prioritized again; Care stay at current levels? relatively high levels. Benefits additional resources added continue to grow. leading to further reductions in mortality rates and education which in turn leads to a population boom. Will focus on preventative Chaga's Disease continues to be Chaga's disease raised as an health campaigns have an seen as a low priority. area of concern. impact on Chagas disease? If unemployment rates stay Unemployment rates are Unemployment rates are high at historical levels, what continually high so parents see which lead to poverty which effects will this have on primary education as the only results in lower attendance in primary education? way to give children a chance. primary education. What would be the effect A new "Coffee Cartel" could A new "Coffee Cartel” could of the re-formation of the create a market that would help create a mono mono-culture similar to “Coffee Cartel”? Honduras rise out of poverty. the Banana plantations of the early 20th century. Scenario Investigation & Analysis – Iteration 2 25
  25. 25. Exploring International Business Environment 5. Clustering of Uncertainties (Sheet 4) Cluster Heading Uncertainties Cluster # 1 ⇒ PL party regaining power in general election ⇒ PN party coming to power in next general election Immediate political ⇒ Role of small parties in general election in 2009 repercussions and ⇒ Will election happen in 2009? consequences of the Coup ⇒ Nature & impact of the decrease in military forces ⇒ Impact of Honduran government with removal of US army from El Salvador airbase Cluster # 2 ⇒ Impact of industrialists buying property on beaches ⇒ Ability of Honduras to develop eco-friendly tourism friendly Impact of tourism on rural ⇒ Change in Garifuna culture by tourism socio-economic conditions ⇒ Does increase in tourism lead to child prostitution ⇒ Impact of tourism on child education ⇒ Will population demographic continue to move to urban setting? Cluster # 3 ⇒ Impact of reducing dependencies of trade in coffee & banana Ability of Honduras to carry ⇒ Change in agriculture crop type – Diversifying / Growing new through industrial and crops on self sufficiency on staple crop agricultural diversification ⇒ Exploration of minerals to increase GDP ⇒ What effects will Central American free trade have on agriculture? ⇒ Possibility of exploiting highly precious metal like zinc silver in Honduras feasible ⇒ What effects will Central American free trade have on agriculture? ⇒ What effect would a renewed mining industry have on the environment? ⇒ Efficiency of the Honduran government in chalking out an ecological policy on mining ⇒ Ability of Honduras to develop bio-fuel from sugar cane & fuel African palm Cluster # 4 ⇒ Will Changes in agricultural policy be influenced by companies like Wall-mart Government agricultural ⇒ How much possible is inculcating Agricultural education in policies and their effect on Primary education? child nutrition ⇒ Availability of Children hospitals in rural areas. ⇒ Adaptation of latest Techniques and Technologies for Agricultural development across the country s ⇒ What will Catholic Church do to affect the lives of under nourished children? ⇒ Role of wheat and Rice farming on Malnutrition of children in rural areas. ⇒ How effective is role of NGO’s in spreading the message “Feed a child in Honduras”? Scenario Investigation & Analysis – Iteration 2 26

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