Potential Opportunity for Samsung to Market in China and Vietnam - Case Study Example

In the current environment of highly competitive global business, it now needs to explore and analyze market potential for its tablet in China and Egypt. Criteria for assessing potential opportunities for Samsung Tablets in China and Egypt Sn. Factors for assessment China Egypt 1. Population/popn growth 1338 mn/nil 81 mn/1.8% 2. GDP per capita $7599 $6180 3. Poverty (%) 36.3 18.5 4. UN education index 0.623 0.560 5. Contribution of private enterprises to GDP More than 50% na 6. PDI (personal disposable income in urban area $2515 na 7.

Inflation (1-7 taken from BTI, 2012) 3.3 11.3 7. Credit rating (S&P) (S&P, 2013) AA- CCC+ 8. Country risk factors Political Technological Economic Social low low low high high low low high 9. e-Business readiness yes yes 10. Business forecast for 3 years (growth rate) 2012 2013 2014 7.8 8.0 8.2 (IMF, 2013) 113.13 126.29 138.48 (HSBC, 2012) China China’s economic reforms since 1978 have opened the market for overseas business and created viable environment for FDI and multinationals. It has shown incredible advancement in economy to become second largest in the world in 2010, surpassing Japan and biggest exporting country in 2009 (bti, 2013).

At the same time, the stimulus package of $586 billion has challenged its dependence on fixed asset and new credit of about $ 2.5 trillion in 2009-2010 could lead to inflationary trend. Though there is wide income disparity with GINI index at 0.475 and urban-rural gap widening from 2.79:1 in 2000 to 3.3:1 in 2009, per capita disposable income in urban areas being $2515 as against $755 in rural areas. South Korea is one of the most important trading partners of China with good bilateral relations.

FDI at $ 105.7 billion in 2010 encouraging, especially when private enterprises contribute more than 50% of the GDP and create more than 80% of new jobs. It has relatively high disposable income which makes it attractive for overseas business, especially, tablets which have huge demand with 41% rise in its demand (Stanley Morgan report, 2011). Egypt The country is continually in a state of high political instability but surprisingly it has not affected its economic development and structural improvement.

The economic reforms introduced during 2004 by the Prime Minister Ahmed Nazif have continued with focused approach. The economic reforms and liberalization has not addressed the problems of literacy and unemployment which has considerably increased poverty and income disparity across the population. 40% of 83 million population comprising of nearly 20 million people are between 18 and 29 years, most of whom are vulnerable to poverty due to lack of education and unemployment. With high inflation rate of nearly 12% and relatively low GDP growth of 5%, the most populous country of Middle East has shown negative growth in both its export and import trade (BTI, 2012).

Despite market liberalization, lack of nepotism and law enforcement has adversely impacted growth of domestic and foreign businesses. There is also rampant gender discrimination and human development index has continually shown down trend. It lacks political commitment and institutional capacity to address the problem of growing illiteracy and unemployment. Recommendation for China China has stable socio-political environment with high growth in GDP which has also made it attractive for overseas business.

With increasing disposable income