144 CHAPTER 6 MARKETINGINGLOBALMARKETS
Thecreationofthesingle Europeanmarketin 1992was expectedtochangetheway
marketingisdoneworldwide.It meantthe birthofa marketthatwaslargerthantheUnited
States, andtheintroductionofEuropeanCurrencyUnits (Euros)in placeofthe individual
currenciesofmembernations.Experienceinmultilingual marketingwouldhelpnon-Euro-
pean companiessucceedinthis giganticmarket.Withnewtechnologies suchasmultilin-
gualprocessingprograms, it would bepos sible totargetpotential customersanywherein
Europe,inanylanguage,andinthesamemarketingcampaign.ProgresstowardEuropeanunificationhas beenslow-m anydoubtthat complete uni-
ficationwilleverbeachieved.However,on January1, 1999, 11 of the 15 membernations
tooka significantsteptowardunificationbyadopting theEuroasthecommoncurrency.
These 11 nationsrepresent 290 millionpeopleanda $6.5trillionmarket.Still, with14 di f-
ferentlanguagesanddistinctivenationalcustoms,it is unlikelythat theEUwilleverbecome
the"UnitedStatesofE urope."Tariffs
Mostnationsencourage freetrade byinvitingfirms toinvestandto conduc t businessthere,
whileencouragingdomesticfirmstoengagein overseas business.Thesenations donotusu -
allytrytostrictlyregulateimportsordiscriminateagainstforeign-basedfirms. Thereare,
however,somegovernments that openlyopposefreetrade.For example, manyCommu-
nisLnationsdesire self-sufficiency.Therefore, theyrestrict trade withnon-Communist nations.
ButtheserestrictionsvarywithEast-Westre lations.
Themostcommonformofrestrictionof tradeisthetariff,a taxplaced onimported
goods.Protective tariffs are establishedinordertoprotect domesticmanufacturers against
competitorsbyraisingthepricesofimported goods.Notsu rprisingly,U.S.companieswith
a strongbusinesstraditioninaforeign country may supporttariffs todi scourage entryby
otherU.S.competicor:;.Expropriation
Allmultinationalfirms facetheriskofexpropriation.Thatis,the foreign governmenttakes
ownershipofplants, sometimeswithout compensatingtheowners.However,inmanyexpro-
priationstherehasbeenpayment,anditisoften equitable. Manyof th esefacilitiesend up
asprivateratherthangovernmentorganizations.Becauseoftheriskofexpropriation, multi-
nationalfirmsareatther;~ercyofforeigngovernments,which are sometimesunsta ble,and
whic:1canchangeth e lawstheyenforceat anypointintime tomeettheir needs.TheTechnologicalEnvironment
Tteleveloftechnologicaldevelopmentofa nationaffects theattractivenessofdoing busi-
nessthere,aswellasthetypeofoperations that are possible. Marketers indeveloped nations
cannottakemanytechnological advancesfor granted.They maynotbeavailable inlesser-
developednations.Considersomeofthefollowingtechnologicallyrelatedproblemsthat
firmsmayencounterindoingbusinessoverseas:- Foreignworkersmustbetrained tooperate unfamiliar equipment.
- Poortransportationsynems;ncreaseproduction andphysicaldistributioncosts.
- Maintenancestandardsvaryfromonenation tothe next.
- Poorcommunicationfucilitieshinderadvertisingthroughthemass media.
- Lackofdataproc~ssingfacilitiesmakesthetasksofplanning,implementing,and
controllingmarketingstrategymoredifficult.