International business

1. Nirjala Rajkarnikar
Country Analysis
This Photo by Unknown Author is licensed under CC BY-SA
This Photo by Unknown Author is licensed under CC BY-SA

2. Introduction: Canada
Rationale
 Neighboring country
 NAFTA partner, comprehensive bilateral trade & investment relationship with USA
 Market entry opportunity
Location and Geography
 Geographic coordinates and Bordering country - USA
 60 00 N, 95 00 W
 Canada - USA border: 3,145 miles (5,061 km)
 Canada - Alaska border: 1,538 miles (2,475 km)
 Water access
 North Atlantic Ocean on the east
 North Pacific Ocean on the west
 Arctic Ocean on the north, north of the conterminous US
 Natural Hazards or climate
 Continuous permafrost in north - a serious obstacle to development
 Cyclonic storms form east of the Rocky Mountains - a result of mixing of air masses from the Arctic, Pacific,
and North American interior and produce most of the country's rain and snow to east of the mountains
 Volcanism - vast majority are in western Canada's coast mountains remained dormant
America/, N. (2018). Canada Map / Map of Canada - Worldatlas.com. Retrieved from https://www.worldatlas.com/webimage/countrys/namerica/ca.htm
Cia.gov. (2018). The World Factbook — Central Intelligence Agency. [online] Available at: https://www.cia.gov/library/publications/the-world-factbook/geos/ca.html [Accessed 6 Jul. 2018].

3. Sociocultural Environment
Country Composition
 A land of vast distances, rich natural beauty, resources & culture
 GDP - $1,550.54 (USD Billion from 2014 -2016)
 Diverse culture
 Literacy Rate
 Rate 99.0% / Ranks 37
 Rate of Urbanization
 Urban population: 81.4% of total population (2018)
 Rate of urbanization: 0.97% annual rate of change (2015-20 est.)
 Heavily Populated Cities
 Most populated province – Ontario, followed by Quebec and British Columbia
 Major Religions
 Major - Roman Catholicism, Protestantism, and irreligion
 Minor – Islam, Hinduism, Sikhism, Buddhism and Judaism
 Educational
 Ranked number one country in the world with most educated female work force
 Not on the list of countries who spend most money on education
 Age Structure
 0-14 years: 15.44% (male 2,819,279/female 2,680,024)
 15-24 years: 11.85% (male 2,171,703/female 2,048,546)
 25-54 years: 39.99% (male 7,227,145/female 7,020,156)
 55-64 years: 14.1% (male 2,492,120/female 2,529,652)
 65 years and over: 18.63% (male 2,958,721/female 3,676,334) (2017 est.)
Cia.gov. (2018). The World Factbook — Central Intelligence Agency. [online] Available at: https://www.cia.gov/library/publications/the-world-factbook/geos/ca.html [Accessed 6 Jul. 2018].

4. Sociocultural Environment
 Values and Communication
 Personal space is valued
 Hofstede’s Six Dimensions of Culture (Figure on right)
 Communication
 English (official) 58.7%, French (official) 22%, Punjabi 1.4%, Italian 1.3%, Spanish 1.3%, German
1.3%, Cantonese 1.2%, Tagalog 1.2%, Arabic 1.1%, other 10.5%
 Communicate more by the spoken word rather than non-verbal expressions. In Quebec - usual to
kiss once on each cheek as in France
Business Etiquette
 Punctuality, politeness, and hand shake with eye contact. Other proper
protocols:
 Business dress code - conventional suit or smart dress; some regions - less formal
 Academic titles – important; first names used after invited to do so
 Business card culture - fairly informal
 Business managers emphasize egalitarianism and diversity, respect is valued,
not expected to pull rank with employees.
 Meetings are generally well-organized and adhere to time schedules
 Meetings tend to be informal and relaxed in manner even if subjects being discussed are serious
 Attendees generally represent a variety of levels/experiences and all are expected to express
opinions or ideas
Compare countries - Hofstede Insights. (2018). Retrieved from https://www.hofstede-insights.com/product/compare-countries/
Geerthofstede.com. (2018). The 6 dimensions model of national culture by Geert Hofstede. Retrieved from https://geerthofstede.com/culture-geert-hofstede-gert-jan-hofstede/6d-model-of- national-culture/
Vulture, C. (2018). International Retail and Cross Cultural Issues. Retrieved from https://www.commisceo-global.com/blog/international-retail-and-cross-cultural-issues
Power Distance:
Score 39
 All individuals in the society are not equal, accepts inequality and power
distance in extent, that less powerful members of institutions expect
and accept that power is distributed unequally
 society’s inequality is endorsed by the followers and the leaders equally
 Interdependent culture, value is placed on egalitarianism, reflecting lack
of overt status and/or class distinctions in society.
 Hierarchy, established for convenience, superiors always accessible,
managers rely on individual employees and teams for their expertise,
consulting and sharing information freely, straight forward exchange of
information is valued.
Individualism:
Score 80
 Degree of interdependence society maintains among members whether
people’s self-image is defined by “I” or “We”.
 Individualist culture society, people supposed to look after themselves
and their direct family only, hence loosely knit society. Same in business
world, employees are expected to be self-reliant and display initiative.
But within exchange-based world of work, hiring and promotion
decisions are based on merit or evidence of what one has done or can
do
Masculinity:
Score 52
 Moderately masculine society.
 Besides being hard working culture, has a work-life balance
 likely to take time to enjoy personal pursuits, family gatherings, etc.
Uncertainty
Avoidance:
Score 48
 more of uncertainty accepting culture, acceptance of new ideas,
innovations and a willingness to try new or different, in technology,
business practices, or consumer products.
 not rules oriented culture and less emotionally expressive
 tolerant of ideas or opinions from anyone and allow the freedom of
expression.
Long-Term
Orientation:
Score 36
 a normative society, having strong concern with establishing the
absolute Truth
 exhibit great respect for traditions.
 relatively small propensity to save for the future.
 focus on achieving quick results.
Indulgence:
Score 68
 Indulgent culture, exhibiting willingness to realize impulses and desires
with regard to enjoying life and having fun.
 possess a positive attitude.
 place higher degree of importance on leisure time, act as please and
spend money as wish.

5. Sociocultural Environment: Observation Deck
Business Observations
Geerthofstede.com. (2018). The 6 dimensions model of national culture by Geert Hofstede. Retrieved from https://geerthofstede.com/culture-geert-hofstede-gert-jan-hofstede/6d-model-of- national-culture/
The World Factbook — Central Intelligence Agency. (2018). Retrieved from https://www.cia.gov/library/publications/resources/the-world-factbook/fields/2116.html
Transparency Report Reveals How Corruption Happens in Real Estate Markets - Raman Media Network. (2018). Retrieved from
Marketing:
 Great opportunities for businesses – culture of acceptance of new ideas and innovations, allows the freedom of expression
 Indulgent culture – exhibits willingness to realize impulses and desires with regard to enjoying life and having fun
Employment and Labor Force:
 Hard work and respect is value
 High percent of prime working age population of 25-54 years 39.99%, male 7,227,14 and female 7,020,156
Product Demand (opportunities):
 Culture of having willingness to try new products or services
 Place higher degree of importance on leisure time, act as please and spend money as wish
Managerial Approach:
 Canadian managers emphasize egalitarianism, diversity & respect is valued. Managers not expected to pull rank with employees.
 Anglophones - meetings may seem more democratic as all participants will engage and contribute whereas
 Francophones - greater respect for hierarchy and position, may revolve more around the most senior attendees
Rules to Business Etiquette:
 Being on point - keeping presentations short and clear on subject is important
 During negotiating - doing homework and learning the company to set clear boundaries and future expectations
 Business planning - typically long term and change is welcomed where necessary, not particularly hierarchical and encourage all to engage in decision making processes
 Rational and logical business culture - facts and figures are important to substantiate claims and promises during presentations

6. Political-Legal Environment
Corruption
Cia.gov. (2018). The World Factbook — Central Intelligence Agency. [online] Available at: https://www.cia.gov/library/publications/the-world-factbook/geos/ca.html [Accessed 6 Jul. 2018].
Transparency Report Reveals How Corruption Happens in Real Estate Markets - Raman Media Network. (2018). Retrieved from
Convention against Corruption. (2018). Retrieved from https://www.unodc.org/unodc/en/treaties/CAC/
Government type  Federal parliamentary democracy (Parliament of
Canada) under a constitutional monarchy;
 Commonwealth realm
 Federal and state authorities and responsibilities
regulated in constitution
Political leader(s)  Chief of state: Queen Elizabeth II (since 6
February 1952)
 Represented by Governor General David Johnston
 Head of government: Prime Minister Justin Pierre
James Trudeau (Liberal Party, 2015)
 Cabinet: Federal Ministry chosen by the prime
minister usually from among members of his/her
own party sitting in Parliament
 Elections/appointments: the monarchy is
hereditary;
 Governor general appointed by the monarch on the
advice of the prime minister for a 5-year term;
 Following legislative elections, the leader of the
majority party or majority coalition in the House
of Commons generally designated prime minister
by the governor general
 Note: the governor general position is largely
ceremonial; Julie Payette, a former space shuttle
astronaut, is Canada's fourth female governor
general but the first to have flown in space
Political pressure (or opposition)
groups
 Bloc Quebecois [Martine Ouellet]
 Conservative Party of Canada or CPC [Andrew
Scheer]
 Green Party [Elizabeth May]
 Liberal Party [Justin Trudeau]
 New Democratic Party or NDP [Jagmeet Singh]
Recent changes in governing rule None
Government and Ideologies
Bribe Index Rank: 8/180
Score: 7.5/10
Corruption Perception Index Rank: 8/180
Score: 82/100
Bribery measures  Transparency International Framework for Assurance of
Corporate Anti-bribery Programs.
 Raises awareness of the damaging effects of corruption and
works with partners in government, business and civil society to
develop and implement effective measures to tackle it.
Enforcement  TI’s report on 2013 stated the reports of turning a blind eye to
bribing foreign officials, where exporting companies often argued
that bribing as the normal way of doing business in foreign
markets and governments of big exporting nations not doing
enough to stop multinational companies from bribing their way
across new and existing international markets, since 1997, 40
major exporting countries have signed up to the OECD Anti-
Bribery Convention, obliging these governments to adopt laws
and enforce them properly to stop bribery of foreign officials in
order to win contracts and licenses, or dodge taxes and local laws
 Transparency International annually assesses these countries to
their commitments. According to its latest assessment, exporting
corruption: OECD progress report 2013, 30 of the 40 countries
signed up to the convention are barely investigating and
prosecuting foreign bribery. Only eight countries have met their
commitments under the Convention. The failure of so many
countries to crack down on companies that bribe foreign
governments imperils the 1997 agreement.
 Enforced in 1997, but 2013 report shows not all country
government were enforcing them or trying to stop bribery.

7. Political-Legal Environment
Trade Regulations and Legal Consideration
 Employment Laws
 Regulates wages, hiring, retiring, sick leave, maternity leave, paternity leave, overtime, holiday pay etc.
 April 1st - wage rate is adjusted by the percentage change in the projected annual Consumer Price Index for Canada in the preceding calendar year
 Overtime compensation is 126-150%, general working hours are 40-44 hours, Maternity leave duration is 14-25 weeks
 VAT/GST Rate
 GST: 5%,
 HST: 13%–15%,
 QST: 9.975%
 VAT is Duties 0-20%
 Governmental Sanctions of other countries
 Despite sanction measures taken by US to Canada no list found on Canada’s behalf.
 Protects and supports U.S. economic prosperity
 Trade Barriers (or Regulation Partners)
 Trans-Pacific Partnership (TPP) negotiations
 North American Free Trade Agreement (NAFTA)
 Fostered relationship by virtue of the agreement's comprehensive, market-opening rules.
Worldwide VAT, GST and Sales Tax Guide - Rates. (2018). Retrieved from https://www.ey.com/gl/en/services/tax/worldwide-vat--gst-and-sales-tax-guide---rates
Current Minimum Wage in Canada, Minimum Wage in Canadian Province. (2018). Retrieved from https://wageindicator.org/salary/minimum-wage/canada/
Sanctions Programs and Country Information. (2018). Retrieved from https://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx

8. Political-Legal Environment: Observation Deck
Business Observations
Government regulations – impact on the businesses
Business owners, CEOs and managers - make daily operational decisions based on regulations
Protects rights of employees, protects environment, enhance fair trades, monitor accountabilities of
corporations etc.
Free trade agreement with North American countries known as NAFTA.
Five Areas of Government Regulation of Business. (2018). Retrieved from https://smallbusiness.chron.com/five-areas-government-regulation-business-701.html

9.  Economic Measures
Economic data: Source: Measurement
Interest rates Trading
Economics
1.50 %
Unemployment CIA.gov 6.5% (2017 est.)
7% (2016 est.)
Inflation CIA.gov 1.6% (2017 est.)
1.4% (2016 est.)
GDP (Real Growth
Rate)
CIA.gov 3% (2017 est.)
1.5% (2016 est.)
0.9% (2015 est.)
GDP (official
exchange rate)
CIA.gov $1.64 trillion (2017 est.)
Exchange rates
against USD
CIA.gov CA$ per US $
1.31 (2017 est.)
1.33 (2016 est.)
1.33 (2015 est.)
1.28 (2014 est.)
1.03 (2013 est.)
Exchange rate
regime
(Guessed) Floating
Labor force CIA.gov 19.52 million (2017 est.)
country comparison to the world: 32
Major industries CIA.gov transportation equipment, chemicals,
processed and unprocessed minerals, food
products, wood and paper products, fish
products, petroleum, natural gas
FDI rates (Foreign
Direct Investment)
Int’l Trade
Center
2.0 % (Net inflow as % of GDP)
 Trade
Major Trading Partners USA, Mexico,
Major Imports Automobiles,
Wine and distilled spirits
Tractors
Vessels
Aero planes
Motorcycles
Consumer goods etc.
Major Exports Steel
Aluminum
Regional Trade Agreements
(Member Countries)
NAFTA
(USA, Mexico, Canada)
Economic-Infrastructural Environment
Country Score Card: Canada 2018 | Logistics Performance Index. (2018). Retrieved fromhttps://lpi.worldbank.org/international/scorecard/radar/254/C/CAN/2018#chartarea
Canada - Economic Indicators. (2018). Retrieved from https://tradingeconomics.com/canada/indicators
The World Factbook — Central Intelligence Agency. (2018). Retrieved from https://www.cia.gov/library/publications/resources/the-world-factbook/geos/ca.html

10. Economic-Infrastructural EnvironmentMajor airports and seaports World Aero Data
World Port Source
Some Major Airports:
Buttonville Municipal airport, Toronto
Carp, Ottawa
Les Cedres, Montreal
Shearwater, Halifax
Canada has 239 ports, most popular are
Fraser River
Fraser River Port*
Halifax
Port of Halifax*
Montreal
Port of Montreal*
Port Cartier
Port of Port Cartier
Prince Rupert
Prince Rupert Port*
Quebec
Port of Quebec*
Sydney
Port of Sydney*
Toronto
Port of Toronto*
Vancouver
Port Metro Vancouver
Railway stations (government websites) Canada.ca NOTA:
There are numerous railway stations in Canada, and the
designated heritage railway stations that are still owned by a
railway company under federal jurisdiction are subject to
the Heritage Railway Stations Protection Act.
Some of the railway stations are
Canadian Pacific Railway Station
Canadian National Railways Station
Calgary and Edmonton Railway Station, Former
And so on.
Internet users CIA.gov Total: 31,770,034
percent of population: 89.8% (July 2016 est.)
Mobile providers txtNation Rogers Wireless (Rogers Communications)
Fido Solutions (Rogers Communications)
Bell Mobility (Bell Canada)
Telus Mobility (Telus)
SaskTel Mobility (SaskTel)
MTS Mobility (MTS)
ICE Wireless
Télébec Mobilité
DMTS Mobility
WIND Mobile
Public mobile(coming soon)
Logistics performance index rating World Bank
Rank: 20
Score: 3.73
Airports in Canada. (2018). Retrieved from http://worldaerodata.com/countries/Canada.php
WPS - Index of ports in Canada. (2018). Retrieved from http://www.worldportsource.com/ports/index/CAN.php
The Directory of Designated Heritage Railway Stations in Alberta. (2018). Retrieved from https://www.pc.gc.ca/en/culture/clmhc-hsmbc/pat-her/gar-sta/ab

11. Economic-Infrastructural Environment: Observation Deck
Business Observations
Strong & stable economy
 Canada is USA’s 2nd largest goods trading partner (2ways) with $582.4 billion in total during 2017
 Canada - U.S. goods trade deficit was $17.5 billion in 2017, a 59.7% increase ($6.5 billion) over 2016.
Abundant natural resources
 large oil and natural gas sector with the majority of crude oil production (world’s seventh-largest oil producer)
 Ranks third in the world in proved oil reserves behind Venezuela and Saudi Arabia
Highly skilled labor force
 Ranked number one in the world with most educated female work force
 Average GDP in the last 10 years is $1,609.88 (USD Billion)
Low level of unemployment
 6.5% (2017 est.) and 7% (2016 est.).
 Ranks 95
Floating exchange rate regime
 Market controls the exchange rate of currency
 Intervention rarely needed
WTO | Regional trade agreements. (2018). Retrieved from http://rtais.wto.org/UI/PublicShowMemberRTAIDCard.aspx?rtaid=122
The World Factbook — Central Intelligence Agency. (2018). Retrieved from https://www.cia.gov/library/publications/resources/the-world-factbook/geos/ca.html
Canada. (2018). Retrieved from http://www.intracen.org/layouts/CountryTemplate.aspx?pageid=47244645034&id=47244654127

12. Final Recommendations
Market Entry Strategies
 Greenfield Investments
 Buying land, building facility and operating business on an ongoing basis
in Canada
 Costly and high risk – But could undertake the cost and risk due to
government regulations, transportation costs, and the ability to access
technology or skilled labor
 Turnkey
 Often the project being financed by an international financial agency
such as World Bank. Hence, risk of not being paid is eliminated
 Client often is government
 Piggybacking
 Reduces risk and costs because essentially the other larger firm is
marketing the product or service for you internationally
 Example: Walmart, Target other local grocery chains, restaurants,
International hotels, McDonalds etc.
Cultural Awareness
 Marketing
 High indulgence society
 Special occasions, holidays are celebrated nationwide, diverse society
 Work-life balance society, takes time to enjoy personal pursuits, family
gatherings and life in general
 Business Interaction Rules
 Punctuality, politeness and shaking hands with everyone in meetings,
maintaining eye contact is important
 Academic titles are important, until invited to use first names
 Keeping presentations short and clear about the subject
 Employment Laws
 Minimum wage, sick leave, hiring, retiring, overtime, working hours,
maternity leave, probation, overtime compensation, severance pay
 Public holidays paid time off, rest time hours, legal employment age
etc.
 Payroll and tax regulations for HR
 Socio-cultural norms
 Personal space is valued, gifts given for birthdays, Christmas etc.
 Besides in Quebec, table manners relatively relaxed informal.
 Large, diverse ethnic population and has significant variations of
traditional meals and foods
Market Entry Strategies. (2018). Retrieved from http://www.tradestart.ca/market-entry-strategies

13. References
Convention against Corruption. (2018). Retrieved from
https://www.unodc.org/unodc/en/treaties/CAC/
Current Minimum Wage in Canada, Minimum Wage in Canadian Province. (2018). Retrieved
from https://wageindicator.org/salary/minimum-wage/canada/
Worldwide VAT, GST and Sales Tax Guide - Rates. (2018). Retrieved from
https://www.ey.com/gl/en/services/tax/worldwide-vat--gst-and-sales-tax-guide---rates
VAT Per Country | Value Added Tax Rates By Country | USCIB. (2018). Retrieved from
https://www.uscib.org/valueadded-taxes-vat-ud-1676/
Sanctions Programs and Country Information. (2018). Retrieved from
https://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx
Five Areas of Government Regulation of Business. (2018). Retrieved from
https://smallbusiness.chron.com/five-areas-government-regulation-business-701.html
Transparency Report Reveals How Corruption Happens in Real Estate Markets - Raman Media
Network. (2018). Retrieved from
http://www.ramanmedianetwork.com/transparencyreport-reveals-how-corruption-
happens-in-real-estate-markets/
The World Factbook — Central Intelligence Agency. (2018). Retrieved from
https://www.cia.gov/library/publications/resources/the-world-factbook/fields/2116.html

14. Thank You!
International Business
(Project Country : Canada)
This Photo by Unknown Author is licensed under CC BY-
SA