Showing posts with label globalization. Show all posts
Showing posts with label globalization. Show all posts

Friday, April 24, 2015

Country branding: The new global marketing strategy

By: Nathalia Rios Ballesteros
Universidad EAFIT, Colombia


“The public impression of a country is important as a source of national pride. Invariably, people source part of their own identity from the image of their country.” –Roberto Cevero, 2012.
Globalization, regional interdependence and global economic integration have traced the path towards a new global paradigm in which not only companies but also countries are engaged in competing at every level. Empirical and historical evidence have shown that countries compete to stimulate exports, attract tourism, appeal foreign direct investments and enhance immigration within its borders. In that respect, governments are turning to branding techniques to differentiate their country on the global stage in order to establish a competitive advantage over rivals “in the belief that a strong country brand can contribute to the country’s sustainable development” (Fetscherin 2010, pg. 1). However, even though this branding technique has become a trending topic nowadays, there is a disappointingly lack of progress in its conceptual development limiting and challenging nation branding’s ability to overcome cynical scepticism among the public (Fan 2010, pg. 2).

Regarding the notion of brand understood as a “multidimensional assortment of functional, emotional, relational and strategic elements that collectively generate a unique set of associations in the public mind” (Aaker 2012, pg. 68), one can say that every country has a unique set of elements ―such as people, places, culture, language, history, food, fashion, etc― and a current image to its international audience through which it can be recognize or associated with, nationally and internationally, thus reassuring the existence of what can be considered as “country brand”.

Thus, nation or country branding can be considered as “a process by which a nation’s images can be created, monitored, evaluated and proactively managed in order to improve or enhance the country’s reputation among a target international audience” (Fan 2012, pg. 6). This term emerged from the marketing literature related to four main marketing fields; country of origin[1], destination branding[2], country image or country-product image[3] and country identity[4] However, over the years, country branding became an interdisciplinary topic, encompassing multiple disciplines apart from marketing and branding topics, such as international relations and public diplomacy (Dinnie 2010, pg. 13)

Its main objectives are generally associated with: promoting a clear, defined and unified identity of a country in the international arena that integrates all productive activities in each country and creating a culture of national identity among its citizens around highly recognized ideologies and customs. At the same time, nation brand aims to: improve a country’s image; align the perception of citizens toward greater patriotism and national pride; provides a competitive advantage as countries compete in the economic and political scenario; reinforce the concept "made in" labels on products sold in international markets; among others (Dinnie 2010, pgs. 17-20).

In regard to its measurement, two main high profile indexes, annually published, has been created with a transparent approach, based on objective secondary data. These are; the Country Brand Index from FutureBrand consultancy and the Anholt GFK Roper Nation Brand Index (NBI) respectively. It is important to recall that these indexes do not account for all dimensions of country branding. However, they represent a starting point as an analytic tool when assessing current status of nation branding among countries.

As to the Country Brand Index regards, apart from being one of the most reliable indexes worldwide, it has expanded the knowledge and research field for nation brand and thus country branding. According to its latest ranking (2014), the five leading countries in this topic were Japan, Switzerland, Germany, Sweden, and Canada. By this, it means that people have stronger than average perceptions of these countries and perceive them equally strong in aspects relating to quality life, values and customs and business potential, as they do for their culture, history, tourism and ‘Made In’ expertise.

Even though any Latin American country appears to be leading the ranking, regional data shows that despite its weaknesses -such as the lacking political freedom, health and education infrastructure’s lag, low standards of living, etc. - the region has effectively offset them seizing its advantages and opportunities in; natural beauty, wide range of attractions, tourist destination and its historical points of interest.

Specifically, Colombia is ranked 63 in the overall list. At a regional level, it belongs to the top 10 Latin American countries included, and it also appears to be the 12 country with the most promising country brand along with 14 other countries including; UAE, Chile, Mexico, India, China, Qatar, South Korea, Brazil, Estonia, among others.

In this context, at a regional level in the last two decades, Colombia has become a key player among Latin American countries. It’s recent accomplishments in terms of; security, socioeconomic development, foreign investment, trade agreements and great tourism opportunities, have not only laid the foundations of national sustained growth but have repositioned the country as an attractive destination and a symbol of talent, hard work and passion. In achieving this, public and private alliances have played a fundamental role; transforming the paradigms and stereotypes surrounding the country for the international audience. This is why, since 2004, various entities ―former Proexport, Inexmoda and the Presidency― gathered around the need of sponsoring a positive country image, which in turn, gave birth to the initial phase strategy to promote Colombia internationally in 2005. The campaign was named “Colombia es pasión” and was enforced until 2011, when Colombia Country Brand was officially created.

Unlike "Colombia es pasión", the new campaign, “La respuesta es Colombia” (Colombia is the answer), is not focused on a specific socioeconomic or political aspect, it instead shows the country as a whole, highlighting all its strengths in terms of culture, biodiversity, tourism, foreign investment, among others.

Regarding the above, it is important to recall that nation branding still stands as an extremely wide and difficult subject to research define and proactively apply from country to country. It is thus a complicated, multifaceted and interdisciplinary construction that varies due to the national context and current framework each country faces. Moreover, its defiant task is how to communicate, in a coordinated and consistent way, a single image or message to different audiences in different countries at the same time. This means, “having one slogan, one campaign, no matter how clever or creative, can’t sell everything to everyone” (Fan 2010, pg. 7). In this sense, nation branding could be more meaningful and relevant if it was conceptualized, measured and executed separately at each one of sublevels (as a place brand, event brand or export brand) because in reality, “it is impossible to develop such a simple core message about a country that can be used by different industry sectors in different countries” (Fan 2010, pg. 7). 

In despite of the challenges and limitations nation branding might have, its impact should not be exaggerated or dismissed, it should, instead, be updated and widely shared with the rest of the world in order to seize its opportunities and extend its effects. As to the Colombian case regards, one can say that although Colombia still faces several challenges on the issue; recent public-private partnerships, government efforts and national commitment have helped improve national image internationally, allowing better and more opportunities to enhance sustained development for the country as a whole.

References



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Footnotes


[1] Country of Origin or the meaning of ‘Made In’ “may associate a product with status, authenticity, and exoticness” (Verlegh & Steenkamp 1999, pg. 523)
[2] Destination branding is about how consumers perceive the destination in their minds.
[3] Refers to the “overall perception consumers form of products from a particular country, based on their prior perceptions of the country’s production and marketing strength and weaknesses” (Roth & Romeo 1992, pg. 480).
[4] National identity refers to a personal sense of belonging to one state or nation, oftenly shared with a group of people, regardless of one's citizenship status. Many professors see national identity in psychological terms as "an awareness of difference" - "a feeling and recognition of 'we' and 'they' (Lee Yonmi 2000).

Thursday, July 31, 2014

Dos momentos relevantes en estos 50 años de la UNCTAD

Por: Andrea Herrera Guaman* (aherrera@eafit.edu.co )
Administradora de Negocios, Universidad EAFIT, Colombia


Desde su creación en el año de 1964 la UNCTAD ha reunido miembros de varios países en diversas ocasiones para tratar temas relacionados con el comercio, las inversiones y la búsqueda de soluciones para ayudar a los países que en materia económica presentan mayores complicaciones. Sin embargo, hoy en día hay dos de esas reuniones que debido a sus resultados y relevancia en el tiempo son consideradas de gran importancia dentro de los esfuerzos realizados por esta organización.

Nos estamos refiriendo en primera instancia a la UNCTAD VIII llevada a cabo en la ciudad de Cartagena, Colombia en el año de 1992 . Para ese entonces se estaba viviendo una fuerte transformación de carácter mundial como consecuencia del fin de la guerra fría, lo que trajo consigo cambios a nivel político y económico de grandes dimensiones.

Estos acontecimientos fueron los que promovieron el tema central de la Octava conferencia de la UNCTAD ; “Una nueva asociación para el Desarrollo” en el cual se buscaba que los Estados miembros tomaran conciencia de la gran oportunidad que se les estaba presentando de establecer las bases políticas de cooperación en busca de un progreso económico y social en todos los países del mundo (UNCTAD, 1992).

Para el final de las sesiones, la Octava conferencia de la UNCTAD reconoció a las empresas privadas y al libre mercado como los principales conductores del crecimiento económico, lo que significo un cambio radical en cuanto a la forma de ver que tenia la Organización en cuanto a lo que significaba desarrollo (Toye, 2014).

El Segundo momento importante de UNCTAD fue la décimo tercera conferencia llevada a cabo en Doha, Qatar en el año 2012. El tema central para esta ocasión era “La globalización centrada en el desarrollo: Hacia un crecimiento y un desarrollo incluyentes y sostenibles, en la cual se consignaron compromisos como los de promover el crecimiento y el desarrollo económico en pro de la reducción de las desigualdades entre países, el uso responsable y eficaz de los recursos naturales , la cooperación económica y el aprovechamiento consiente de las ventajas que la globalización presenta, los cuales reposan hoy dia en el documento denominada Manar de Qatar (UNCTAD, 2012).

Los eventos ocurridos en Doha han sido los que finalmente le han permitido a la UNCTAD revisar y analizar algunos de propuestas a largo plazo a la vez que le ha mostrado los cambios positivos ocurridos en estos últimos 50 años (Toye, 2014).

Referencias


Toye, J. (2014). UNCTAD at 50. Digital Library – UNCTAD Virtual Institute on Trade and Development. [online] Vi.unctad.org. Available at: http://vi.unctad.org/resources-mainmenu-64/digital-library?i=VI&op=all&q=UNCTAD+at+50%3A+A+short+history&act=search&option=com_gslink [Accessed 13 Jul. 2014].

UNCTAD (1992). Una nueva asociación para el desarrollo. [online] Available at: http://unctad.org/es/Docs/tdviiimisc4_sp.pdf [Accessed 29 Jul. 2014].

UNCTAD (2012). nforme UNCTAD 13° periodo de sesiones 2012 onferencia de la Naciones Unidas sobre desarrollo y comercio onferencia de las Naciones Unidas sobre Comercio y Desarrollo 13° período de sesiones. [online] Available at: http://unctad.org/meetings/es/SessionalDocuments/td500_Add_2sp.pdf [Accessed 30 Jul. 2014].

Friday, September 20, 2013

Global Value Chains: Governance and Interventions

Opinion article by: Manuela Ramírez Cardenas (mramir67@eafit.edu.co)*
International Business and Political Sciences student at Universidad EAFIT, Colombia.

UNCTAD’s World Investment Report for 2013 highlights the importance of Global Value Chains as contributors for development, stating that they “have a direct economic impact on value added, jobs and income” (UNCTAD, 2013) as well as providing opportunities to build the productive capability of a country that would give it the chance for long term industrial upgrading. The WIR 2013 also highlights the risk in participating in GVC because countries, specially poorer developing countries, capture only a small share of the value created in the chain as they only participate on the low value added activities, like the supply of natural resources, and they risk remaining locked on those low value added activities without actually upgrading in the long term.
To avoid the risk of remaining on the lower part of the value chain it is important to implement policies that would enable GVC to actually work for development and the improvement of a country’s productive capability, however this is difficult due to the governance of the chain. According to John Humphrey & Hubert Schmitz governance “refers to the inter-firm relationships and institutional mechanisms through which nonmarket coordination of activities in the chain is achieved” (Humphrey & Schmitz, 2001), usually done by firms in developed countries, who are the ones that have the intangible competences– i.e. marketing, R&D, etc.- that are characterized by high barriers of entry and high economic returns that allow them to be located on a higher part of the value chain. Access to those intangible competences is tough due to those high barriers of entry that require investment, so developing countries usually remained locked in tangible activities which must follow the requirements set by the governors of the chain, that is, the developed countries’ firms.
The governors of the chain impose requirements that those on the lower part of the chain must meet in order to participate in it, and often developing countries are expected to comply with requirements that do not apply yet to their own domestic market, and this highlights the competitive challenges these countries face, with the possibility of an eventual exclusion in the participation of those markets, and makes it nearly impossible for those countries to implement actual policies that would eventually give them access to a higher value gain in the chain.
In my opinion, if GVC are to be successful tools for development, the governors of the GVC must implement value chain interventions focused on the support for development, not from an economic perspective but instead from a holistic viewpoint, by taking decisions that target the improvement of the quality of the lives of the different actors involved in the value chain and the reduction of poverty.
One of those value chain interventions that could have a positive impact in the reduction of poverty is related to the agricultural sector. There are studies that show that the growth generated by agriculture is more effective in reducing poverty that the growth generated in other sectors (Seville, Buxton, & Vorley, 2011), so it is paramount that developing countries that have a precarious agricultural sector, characterized by the poverty of the small-scale farmers, implement strategies to allow those small-scale farmers and producers to connect to value chains in formal markets to give them opportunities to actually overcome poverty, as it has been theorized that “linking smallholders with well-functioning local or global markets – ranging from local ‘street markets’ to formal global value chains – plays a critical part in long-term strategies to reduce rural poverty and hunger” (Seville, Buxton, & Vorley, 2011). However for countries like Colombia, the process of linking the small-scale farmers to global value chains is complicated, as the agricultural sector in the country has several structural challenges, ranging from lack of adequate infrastructure to lack of skills and training.

References: 

Humphrey, J., & Schmitz, H. (2001). Governance in Global Value Chains . Retrieved August 27, 2013, from Institute of development Studies: http://www.ids.ac.uk/files/dmfile/humphreyschmitz32.3.pdf 
Seville, D., Buxton, A., & Vorley, B. (2011). Under what conditions are value chains effective tools for pro-poor development?. Sustainable Food Lab & The International Institute for Environment and Development . International Institute for Environment and Development/Sustainable Food Lab . 
UNCTAD. (2013). World Investment Report 2013. UNCTAD. United Nations.

Thursday, September 5, 2013

El paro nacional y la sociedad civil: en búsqueda de alternativas de la economía colombiana

Por: Carolina Herrera Cano* (caroherca@gmail.com )
Estudiante de Negocios Internacionales. Universidad EAFIT, Colombia

La crisis de violencia vivida la semana pasada en el país a causa del paro agrario que permeó el resto de los sectores de la economía nacional es, para muchos, una verdadera reivindicación del papel de la sociedad civil en los sistemas democráticos; debido a las movilizaciones sociales que desató. No obstante, una vez que ha cesado una de las jornadas más violentas que ha vivido Colombia en los últimos años y de que los bloqueos viales y la tensión urbana han disminuido, la discusión sobre el desarrollo de la nación debe ir más allá del descontento generalizado hacia el poder ejecutivo.
Sería un error negar las consecuencias políticas que ha desencadenado esta situación que, combinada con las actuales discusiones de tintes internacionales (de territorio y de procesos de paz) que afronta el gobierno, crean un panorama político incierto; mas esta coyuntura suscita análisis más allá de la gestión presidencial. Para este caso, pone en evidencia la dificultad de afrontar los retos de la globalización y la liberalización de la economía sin la apropiada estructuración de las instituciones estatales. Por lo tanto, definir las estrategias a implementar ante el paro nacional, más que una labor de emergencia por parte del presidente, deberá ser un esfuerzo institucional hacia la apropiada inserción de la economía colombiana en un mundo interconectado.
Mucho se ha discutido sobre las ventajas y desventajas que trae consigo la globalización en términos económicos, pero el inminente aumento de acuerdos comerciales demuestra que son pocas las discusiones sobre pertenecer o no a las cadenas globales, puesto que han sido remplazadas por la identificación de las estrategias más adecuadas para posicionar los productos locales en los mercados internacionales. Es por esto que durante los últimos años, la política comercial colombiana se ha caracterizado por la atracción de inversión extranjera directa (IED) por parte de empresas transnacionales que, sin duda, han modificado la manera en que funcionan la industria, el empleo y el ingreso en el país.
Por supuesto el flujo de capital, la creación de empleo y, en menor medida, el acceso a conocimiento han beneficiado los indicadores macroeconómicos del país. No obstante, la disminución generalizada en los niveles de IED que ha sufrido la economía internacional luego de la crisis económica y financiera que comenzó en 2008 (UNCTAD, 2013), ponen en duda la efectividad de la estrategia de facilitar, mayormente, un rol pasivo (de atracción de capital) en las cadenas globales de valor. Muestra de ello es el descenso de 6,2% en la IED que presentó la Colombia, sobre todo la proveniente del sector de la minería y el petróleo[1] (Portafolio.com, 2013).
El reporte de inversión WIR 2013 (UNCTAD, 2013) se resalta cómo la IED puede representar una vía importante para los países en desarrollo hacia el acceso a las cadenas globales de valor y a su participación; en este sentido, la economía colombiana ha logrado satisfacer muchas de sus expectativas. Sin embargo, ante las deficiencias del mercado y del gobierno, que han aflorado ante el panorama del paro nacional, valdría la pena evaluar si existen medidas alternativas que, de igual manera, busquen favorecer el posicionamiento de la producción colombiana en el exterior, al tiempo que den respuesta a las problemáticas de desigualdad que presenta el camino hacia el desarrollo del país.
La UNCTAD (2010), en su comunicado sobre la inserción de las pequeñas y medianas empresas de los países en vías de desarrollo a las cadenas globales de valor, destaca el caso colombiano de la exportación de producciones audiovisuales hacia exigentes mercados en diferentes continentes. Este ejemplo demuestra las diferentes alternativas que puede tener la producción nacional para diversificar su portafolio y asumir nuevos roles en la economía mundial. A pesar de esto, es importante resaltar que este caso ha surgido gracias al apoyo que ha recibido esta industria por parte del gobierno (ventaja competitiva).
En un país donde las principales exportaciones se ubican en el sector primario, resulta bastante complejo direccionar las actividades económicas de manera repentina. Es por esto que, en escenarios tan complejos como el que deja el paro agrario, vale la pena cuestionar la estrategia pasiva de atracción de IED y evaluar opciones que respondan a las demandas internacionales. Se hace necesaria una visión a largo plazo que esté más allá de las decisiones del jefe de gobierno: urge en Colombia una política de Estado dirigida hacia el aprovechamiento de los recursos en aras de una posición verdaderamente activa, que promueva la creación de valor para los sectores productivos y su adecuada inserción en las cadenas globales.




[1] Sería interesante evaluar una posible causalidad entre este hecho y la desaceleración que ha tenido la industria colombiana en los últimos meses.


Referencias


Portafolio.com. (2013). Inversión extranjera llegó a US$8.750 millones en semestre. Disponible en: http://www.portafolio.co/economia/inversion-extranjera-colombia-primer-semestre [Septiembre 3 de 2013].
UNCTAD. (2013). World Invesment Report 2013.
UNCTAD. (2010). Integrating Developing Countries’ SMEs into Global Value Chains. United Nations: New York and Geneva.



Tuesday, August 20, 2013

Global Value Chains (GVCs): the path towards a global economy

Opinion article by: Nathalia Rios Ballesteros* (nriosba@eafit.edu.co
Economics student at Universidad EAFIT, Colombia.

Global capitalism has taken over the current economic field. Over the last two decades, terms such as ‘globalization’, ‘internationalization’ and  ‘international free trade’ have emerged and have jointly given rise to a new line of research and a new ‘form of trade’ which has increased greatly in importance nowadays: Global Value Chains (GVCs).  According to Gereffi (2003) a value chain is the range of activities –understood as a set of process that take place transnationally - involved in the design, production and marketing of a product before it is turn into a final good; it is ‘the functional integration and co-ordination of internationally dispersed activities’’ (Gereffi 1999: 41)
Within this broad framework; the growing integration of the global economy posed by the implementation of the GVCs in the various sectors of the economy, has provided the opportunity for substantial economic and income growth, creating and promoting significant opportunities for developing countries and regions as a way to potentially increase the rate and scope of industrial growth and the upgrading of their manufacturing and service activities as well as a way for addressing the poverty and inequality inherent to its internal situation.
However, at the same time, GVCs carry along not only positive but also negative attributes for these countries. As it was stated by the UNCTAD WIR for 2013, even though developing countries are increasingly becoming active participants of GVCs and thus gaining significant improvements in living standards and domestic value added in their exports - higher contribution to countries’ GDP- through it, it still remains a long way towards equity in contrast with developed economies. In this sense, as global trade grows, developed economies appear to increase import dependence for exports, allowing developing countries to add disproportionately to their domestic value; in a nutshell, innovation activities tend to attract higher incomes and continue to be concentrated in the developed countries.
In this context, it seems like the impact of GVCs on inequality is perhaps a complex and wide reality, but unraveling this ‘complexity’ is the key challenge for all developing economies in order to succeed in their path towards integral growth and economic development. What matters then, is how producers – whether firms, regions or countries – become active participants of the global economy and GVCs to narrow this disparity. Hence, there is a need to manage and control the mode of insertion into this ‘plural economy’, to ensure that incomes are not reduced or further transferred to developed countries. Thus, identifying the circumstances which enable developing countries to extend and transform their production capabilities into innovation capabilities along with profit maximization, acquisition of competitive and comparative advantage, reduction of reliance on developed countries to create own-domestic value added and the diversification and expansion of the range of production, which implies exploring other economic sector and fields, rather than sticking into the one that provides the least profit range: the primary sector, can become useful strategies to forge the way to a true global economy.


References: 

Gereffi, G., 1999, ‘International trade and industrial upgrading in the apparel commodity chain’, Journal of International Economics, Vol 48, No 1, pp 37-70.