Academic journal article Journal of Economics and Economic Education Research

Market Attractiveness Evaluation of Sub-Saharan Africa, Applying Swot Analysis and Ahp Methods

Academic journal article Journal of Economics and Economic Education Research

Market Attractiveness Evaluation of Sub-Saharan Africa, Applying Swot Analysis and Ahp Methods

Article excerpt

INTRODUCTION

Currently, convincing argument can be made that globalization has led to advancement in technologies and this advancement has ushered a new world without boundaries. Countries are currently interconnected by flows of knowledge and information through computers, TVs, and satellites and also the web and the internet have revolutionized and hastened how business is conducted globally. (Bhandari & Heshmati, 2005). Hence, ideas exchange has increased tremendously thus altering consumer perception and preferences while boosting countries' economies, trade, technologies and improved health care. However, understanding the global business environment and its complexities is challenging especially when, each nation's market environment is composed of unique cultural, political, legal and economic characteristics that defines or dictates how business is conducted in the nation's boundaries; this set of national characteristics may differ greatly from nation to nation. Consequently, globalization can be helpful for achieving genuine development but these conditions are not sufficient, and indeed, managed poorly, the local response or lack of response to globalization can ultimately do more harm than good for developing countries. (Tadaro & Smith, 2003). Regardless, this phenomena has opened up new markets that were once crossed to foreign companies, and its ultimate effect on trade will only increase the importance of standalone nations and regional trading blocs.

Although there are tons of literatures that have examined issues regarding to the selection of global emerging markets that are attractive to Multinational Enterprises (MNEs) in the developed countries. There are few academic studies that address the attractiveness of developing countries such as in Latin America, Far East Asia, and Mediterranean Africa. However, currently, empirical research on opportunities in Sub-Saharan nations is very limited both in quantity and focus. Therefore, research expands the understanding of the potential of yet another untapped developing nations with great market attractiveness potential. Generally, traditional market selection analysis relies on purely macroeconomic and political factors at the outset of the analysis, and fails to account for a developing market's vitality and future potential resulting from rapid change, national attributes that affect specific sectors and market receptiveness. (Sakarya & Eckman & Hyllegard, 2006). Moreover, the analyzed available information for those developing countries primarily deals with economics and economic systems, which perceives the market attractiveness to be related to only two sets of factors deriving from two points of view: economic & financial and political. (Saaty 1980; Tripodo & Dazzi, 1995; Abid & Bahlouh, 2011). However, these two set of factors are not sufficient to fully analyze the complexities of market attractiveness in Sub-Saharan African nations, which differs from those of developing nations in Mediterranean Africa, Asia and Latin America in terms of social cultural, political systems the level of economic development, and geographic climatic conditions, their markets are characterized by higher degree of risk than their developed counterparts. Therefore, this research incorporates the two sets of factors deriving from two points of view: economic & financial and political and expands them with macro indicators namely, social cultural, technological factors and infrastructure in the multi criteria decision problem analysis., into few easily understandable priorities based on the degree of conformity between potential or existing market environmental factors at the macro level (national level) emphasizing on the external environment of each country's social/cultural, political/ legal, economic and technological applying AHP methodology. The research presents important opportunities for MNEs operating in the areas of financial services, mineral resources, infrastructure development, industrial sector development and various other related consultancies. …

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