Semester Summer 2020 Assessment Week 2 Course International

1semester Summer 2020assessment Week Week 2course International Marke

Read the mini case “World Trade Goes Bananas” and answer the questions accordingly. The case discusses the impact of political trade disputes, specifically the U.S.-EU banana trade conflict, on small businesses and international trade. The questions focus on the relationship between politics and global business, legal mitigation strategies for affected businesses, and lessons learned from the trade dispute.

Paper For Above instruction

The intersection of politics and global business is vividly exemplified by the “Banana War” between the United States and the European Union. This dispute underscores how geopolitical interests, trade policies, and lobbying influence international commerce, often leading to economic disruptions for smaller enterprises. The conflict originated from EU measures favoring imports from former colonies, which the U.S. contended were illegal trade barriers. The retaliatory tariffs and quotas not only affected large corporations like Chiquita but also severely impacted small businesses such as Reha Enterprises, which operated in niche markets and lacked the political clout of major players. This scenario reveals that political decisions can dramatically alter market access, trade flows, and economic stability, emphasizing that global business is inherently intertwined with national and international political agendas. Such disputes highlight the vulnerability of small firms in navigating complex, politicized trade environments and the importance of understanding geopolitical risks in international operations (Czinkota & Ronkainen, 2013).

Reha Enterprises could have legally mitigated the effects of this trade war through strategic compliance and proactive legal and trade planning. Firstly, the company should have maintained meticulous documentation of import transactions, including accurate customs classifications and invoices, to ensure compliance with trade laws and avoid penalties or fines. Engaging with trade attorneys or customs consultants would have provided expert guidance on tariff classifications and potential exemptions or rebates. Additionally, Reha could have diversified its sourcing and markets, reducing dependency on European imports vulnerable to political tariffs by exploring alternative suppliers from countries not affected by tariffs. Implementing a proactive lobbying strategy by joining trade associations and engaging with policymakers could have also provided early warnings and influence over trade policy developments. Finally, the company could have explored legal avenues such as filing for tariff exemptions, seeking trade dispute resolutions, or participating in compliance programs aimed at small businesses. Such measures would have strengthened their ability to adapt legally within the complex framework of international trade law (Hufbauer et al., 2007).

The “Banana War” offers valuable lessons for business owners engaging in global trade. Primarily, it underscores the importance of understanding the geopolitical landscape and the potential impact of political decisions on trade operations. Businesses must stay informed about international trade policies, tariffs, and quotas that could abruptly alter market conditions. Moreover, a diversified supply chain and market portfolio serve as critical risk mitigation tools, preventing over-reliance on politically vulnerable regions. Engaging with legal and trade experts, establishing alliances with trade associations, and maintaining proactive communication with policymakers are essential strategies to navigate politically charged environments effectively. The case also highlights the necessity of agility—adapting quickly to changing regulations and legal frameworks minimizes adverse effects. Additionally, small businesses need to recognize their limited influence and therefore should prioritize collective lobbying efforts and compliance strategies to safeguard their interests. Overall, the dispute illustrates that understanding political dynamics and maintaining flexibility are vital for sustaining success in international markets (Keohane & Nye, 2012).

References

• Czinkota, M. R., & Ronkainen, I. A. (2013). International Business. Cengage Learning.
• Hufbauer, G. C., Schott, J. J., & Brunel, C. (2007). US-China Trade Disputes. Peterson Institute for International Economics.
• Keohane, R. O., & Nye, J. S. (2012). Power and Interdependence. Longman.
• Ravenhill, J. (2014). Global Political Economy. Oxford University Press.
• Husted, B. W., & Allen, D. B. (2016). Corporate Social Responsibility in the Global Marketplace. Routledge.
• Ghemawat, P. (2007). Redefining Global Strategy. Harvard Business Review.
• Porter, M. E. (1985). Competitive Advantage. Free Press.
• Levitt, T. (1983). The Globalization of Markets. Harvard Business Review.
• Nye, J. S. (2004). Soft Power. Public Affairs.
• World Trade Organization. (2020). Trade Policy Review: European Union. WTO Publications.