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SUPPLEMENTARY READING

The Economy of Great Britain

People in countries outside the British Isles often call the inhabitants of the United Kingdom English. This is incorrect, for there are at least four main nationalities, the English, the Scots, the Welsh and the Irish. These four nationalities each have their own language and culture.

Great Britain is one of the world’s leading industrialized nations. It has achieved this position despite the lack of most raw materials needed for industry. It must also import 40% of its food supplies. Thus, its prosperity has been dependent upon the export of manufactured goods in exchange for raw materials and foodstuffs. Within the manufacturing sector, the largest industries include machine tools; electric power, automation, and railroad equipment; metals; chemicals; coal; petroleum; paper and printing; food processing; textiles; and clothing.

The economy is based largely on private enterprises but has some major publicly owned industries (notably coal, steel, gas, electricity and railways) and a few joint enterprises. The Government is reducing the size of the public sector, returning the parts of the steel, transport, telecommunications and aerospace industries, for example, to private enterprise.

The working population is just over 26 million (in a total population of 56 million) of which 7% are self-employed. Just under 40% are women. Unemployment has risen to around 3 million. Britain exports over 30% of its GDP. Machinery and transport equipment account for about one-third of export while finished manufactures comprise over one-third of imports. A recent trend has been the large fall in oil imports and the emergence of a significant export trade.

Earnings from invisible export, including financial and other services, are about half as much as those from visible exports. The Government aims to defeat inflation through firm fiscal and monetary policies, increasing competition, reducing the rise in public expenditure and restoring incentives to industry, particularly small businesses.

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The Economy of Germany

Germany is the largest national economy in Europe, the fourthlargest by nominal GDP in the world. Since the age of industrialization, the country has been a driver, innovator, and beneficiary of an ever more globalised economy. Germany is the world’s second largest exporter with $1.120 trillion exported in 2009 (Eurozone countries are included). Exports account for more than one-third of national output.

Germany is relatively poor in raw materials. Only lignite and potash salt are available in economically significant quantities. Power plans burning lignite are one of the main sources of electricity in Germany. Oil, natural gas and other resources are, for the most part, imported from other countries. Germany imports about two thirds of its energy.

The largest annual international trade fairs and congresses are held in several German cities such as Hanover, Frankfurt, and Berlin.

Of the world’s 500 largest stock market listed companies measured by revenue, the Fortune Global 500, 37 are headquartered in Germany.

With unification on October 3, 1990, Germany began the major task of reconciling the economic systems of the two former republics. Its task was complicated by the dismantling of the extensive welfare system of the former German Democratic Republic, which resulted in a temporary but significant drop of the standard of living of its citizens; interventionist economic planning ensured a quick return of the standard of living and a gradual increase up to the level of that of western Germany.

Even after the German reunification in 1990, the standard of living and annual income remains significantly higher in the former West German states. The modernization and integration of the eastern German economy continues to be a long-term process scheduled to last until the year 2019, with annual transfers from west to east amounting to roughly $80 billion. The overall unemployment has consistently fallen since 2005 and reached a 15-year low in June 2008 with 7.5%. The percentage ranges from 6,2% in former West Germany to 12,7% in former East Germany.

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The Economy of France

By the 18th century, France was one of the world’s richest nations.

Industrialization began promisingly at the end of the 18th century, as it did in England. Unlike England and the rest of Europe, however, France failed to maintain the moment of its early industrial start and was still primarily an agricultural nation at the end of the 19th century. Industry expanded behind protective trade barriers in the early 20th century, but most growth has occurred since the end of World War II. France now ranks among the world’s most economically advanced nations.

The leading manufacturing industries are metallurgy, mechanical and electrical engineering, chemicals, and textiles. France is one of Europe’s leading producers of steel and aluminum. These and imported metals are fabricated into a wide range of mechanical and electrical equipment marketed throughout the world. A wide range of chemicals, including perfumes, pharmaceuticals, nitric acid, sulfuric acid, and fertilizes, are also produced. The French textile and garment industry has long been known for its high fashion, although in recent years the industry has lost many former markets to lower-priced imports from countries with lower labor costs.

France is the leading agricultural nations of Western Europe, and about 7% of the labour force are engaged in agriculture, forestry, and fishing. Three-fifths of the land area is used for agriculture; about onethird is cultivated; one-quarter is used as meadow and pasture. France is a leading European producer of beef, veal, poultry, and dairy products. Cereals and sugar beets are the most important crops. Wine is the major crop throughout the country, both the wine ordinaire, or everyday wine, of the region and the appellation controlee, or quality-controlled, wines of such regions as Burgundy, Champagne, Bordeaux, and Alsace. Flowers are grown for perfume at Grasse, and a wide variety of fruits and vegetables are raised in the warm Mediterranean region for shipment to northern and central Europe.

Fishing is locally important in the costal areas of Normandy and Brittany, the southern Atlantic coast, and the Mediterranean.

France is one of the leading exporters and importers on the foreign trade market. Most trade is conducted with other members of the European Union.

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The Economy of Spain

The economy of Spain is the ninth-largest economy in the world, based on nominal GDP comparisons, and the fifth-largest in Europe. It is regarded as the world’s 15th most developed country. Spain’s economy had been credited with having avoided the virtual zero growth rate of some of its largest partners in the EU.

The Spanish government official GDP growth forecast for 2008 in April was 2.3%. This figure was successively revised down by the Spanish Ministry of Economy to 1.6. In reality, this rate effectively represented stagnant GDP per person due to Spain’s high population growth, itself the result of a high rate of immigration.

Since the 1990s some Spanish companies have gained multinational status, often expending their activities in culturally closed Latin America. Spain is the second biggest foreign investor there, after the United States. Others have expanded into Asia, especially China.

During the last four decades the Spanish tourism industry has grown to become the second biggest in the world, worth approximately 40 billion Euros, about 5% of GDP, in 2006. Being the second tourism destination in the world, Spain has a tourism industry sector which contributes nearly 11% to the country’s GDP employing about 2 million of the total labour force.

The automobile industry in Spain is a large employer in the country, employing 9% of the total workforce in 2009 and contributing to 3.3% of the Spanish GDP, despite the decline due to the economic recession of the past couples of years. In 2009, Spain was in the top ten of the largest automobile producer countries in the world.

The Economy of Italy

Italy has a capitalist economy with high GDP per capita and developed infrastructure. According to both the International Monetary Fund and the World Bank, in 2009 Italy was the seventh-largest economy in the world and the fourth-largest in Europe. Italy is a member of the Group of Eight (G8) industrialized nations, the European Union and the OECD.

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In Italy there is a considerable north-south divide, where Northern Italy is dominated by a highly developed and capitalistic economy, whilst Southern Italy is far less advanced and more based on agriculture and tourism.

Italy has few natural resources. With much of the land unsuited for farming, it is a net food importer. There are no substantial deposits of iron, coal, or oil. Proven natural gas reserves, mainly in the Po Valley and offshore Adriatic, have grown in recent years and constitute the country’s most important mineral resource. Most raw materials needed for manufacturing and more than 80% of the country’s energy sources are imported.

The energy sector is highly dependent on imports from abroad: in 2006 the country imported more than 86% of its total energy consumption.

The northern part of Italy produces primarily maize corn, rice, sugar beets, soybeans, meat, fruits and dairy products, while the south specializes in wheat and citrus fruits. Italy is the first or the second largest producer of wine in the world and one of the leading in olive oil, fruits, flowers and vegetables.

Unemployment is a regional issue in Italy – low in the north, high in the south. Chronic problems of inadequate infrastructure, corruption, and organized crime act as disincentives to investment and job creation in the south. A significant underground economy absorbs substantial numbers of people, but they work for low wages and without standard social benefits and protections. Women and youth have significantly higher rates of unemployment than do men.

The Economy of the Netherlands

The Netherlands has a prosperous and open economy, which depends heavily on foreign trade. The economy is noted for stable industrial relations, fairly low unemployment and inflation, a sizable current account surplus, and an important role as a European transportation hub. Industrial activity is predominantly in food processing, chemicals, petroleum refining, and electrical machinery. A highly mechanized agricultural sector employs no more than 2% of the labour force but provides large surpluses for the food-processing

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industry and for exports. The country is one of the leading European nations for attracting foreign direct investment.

The stern financial policy has been abandoned in 2009 on account of the current credit crises. The relatively large banking sector was pertly nationalized and bailed out through government interventions. Large unemployment, double the current rate of 4% is expected since the Netherlands is an open economy. The government wants to stimulate the economy by accelerating already planned projects. Fundamental reforms for long term recovery will be implemented as well.

While the private sector is the cornerstone of the Dutch economy, governments at different levels have a large part to play. In addition to its own spending, the government plays a significant role through permit requirements and regulations pertaining to almost every aspect of economic activity. The government combines a rigorous and stable microeconomic policy with wide-ranging structural and regulatory reforms. The government has gradually reduced its role in the economy since the 1980s.

Services account for more than half of the national income and are primarily in transportation, distribution, and logistics, and in financial areas, such as banking and insurance. Industrial activity, including mining, generates about 20% of the national product and is dominated by the metalworking, oil refining, chemical, and food-processing industries. Construction amounts to about 6% of GDP. Agriculture and fishing, although visible and traditional Dutch activities, account for just 2%.

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	CONTENTS
Unit 1 Being an Economist ------------------------------------		4
Unit 2	Money ------------------------------------------------	9
Unit 3	Economy ----------------------------------------------	15
Unit 4	Company ----------------------------------------------	20
Unit 5	Company history ------------------------------------	27
Unit 6 Company structure (A) ------------------------------		32
Unit 7 Company structure (B) -----------------------------		37
Unit 8	Business travel ----------------------------------------	42
Supplementary reading ----------------------------------------		51

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