Question

explain why the globilisation indices below would support the opportunity for your company to expand its exportation business of fruit and vegetable to Kenya and Tanzania :

1.KOF index

2.Gini coefficient

3.trade to GDP ratio

4.human development index

Answer 1

The Globalization indices would support the opportunity for the company to expand the exportation business of fruits and vegetables to Kenya and Tanzania. At first, we have to know what is the globalization index. Globalization is measured by the flow of trade, foreign direct investment, and portfolio investment along with some restrictions reflected to this flow. There are different types of indices like KOF index, Gini coefficient, Trade to GDP ratio, and Human development index, etc.,

KOF is an acronym to Konjukturforschungsstelle which is a german word meant to Economic cycle research institute. It is an index of the globalization of countries. It makes use of 24 variables with three globalization aspects: Economic Globalization, Social Globalization, and Political Globalization. Globalization in Kenya and Tanzania associated with an increase in product markets via international trade contrast to capital markets in foreign investments and the labor market through international migration. The economy in these countries faced many shocks one back to another. If exportation business to these countries mostly effects on the labor market. Since the global economy gradually integrating with foreign investments. The majority of people in these African Countries believed in industrial globalization and foreign trade hence exports and imports to Kenya and Tanzania would be a supportive business to expand the company in these countries.

Gini coefficient is a measure of distribution developed to measure the economic inequality and income distribution and also wealth distribution. In African countries, it was reported as 40.8 in 2017. According to this index, wealth distribution is unequal and the poverty level and human rights levels are purely indistinct in this country. Hence exportation business to these countries is not that much supportive. Even though business and foreign trade rapidly developing in these countries, inequality measures exist for decades. If the Exportation business expands in these countries, it changes the wealth distribution among the people.

Trade to GDP indicates the trade importance over the international market affects the economy of the country. Kenya and Tanzania are the countries with less export ratio of goods and services include transport, communication, merchandise. The economy of Kenya and Tanzania are market-based with the free external trade system. The balance of trade is plays a key role in country's GDP. Trade to GDP directly proportional to exports and import value of goods and services. Kenya and Tanzania are the trade hubs in African countries, hence exports business is a good opportunity for the company according to Trade to GDP Globalization Index.

The human development index measures income, education, life mortality. According to globalization statistics, Kenya and Tanzania are the countries having poor human development index with fewer income sources, low education ratios, and a moderate life mortality rate. When we think in an ethnic way, export business in these countries bears a good opportunity while in contrast to this, it is not a secure project to do the export business in these countries.

Globalization indices would always support to do export business to Kenya and Tanzania as a good opportunity because of trading with highest rate of indices who lead to economic crises over the upcoming globalized countries, economic inequality, wealth management is disturbed. Countries with fewer ratings have a higher labor market even though having adverse results, which are not stable over the life period. Dynamic change of globalization will affect the ratio of poor and rich and hence good to do business by not considering the adverse effect reasons.