Free «Saudi Arabia Case» Essay Sample

Current issues facing Saudi Arabia

Climate for doing business in Saudi Arabia today

Saudi Arabia is one of the areas facing many issues in terms of contemporary business development. In order to develop business in this area, it is necessary to be a risky executive willing to take a chance and establish an enterprise in one of the most unstable regions. First, the region faces an issue of its infrastructure. Many parts of the country are old and require reconstruction in order to make them safe for business development. There are numerous problems with electricity, landline facilities, and pipes. The region should go through accommodation in order to become an area, which can bring any company to success. Contemporary level of the region’s development does not meet requirements of modern business standards. Saudi Arabia is famous for its terroristic acts and criminal activity. Once the reputation is attained, it is hard to change it. In addition, the region is under threat of war from the side of Iraq. It does not mean that Iraq is going to invade Saudi Arabia soon. However, it is necessary to consider this risk before taking decisions. In addition, the case showed that it was impossible to rely on business partners from Saudi Arabia. They tend to lie and turn business cooperation for their benefit. As a result, they destroy any business cooperation and create negative reputation of the region. It means that Saudi Arabia does not have an appropriate climate for business development. As long as the region does not have highly developed infrastructure, it will only decrease the development of any business willing to expand its activity in Saudi Arabia. In general, the region needs transformation in the government and policy in order to switch to safe and reliable cooperation with other countries. However, negative reputation reflected by terrorism and irresponsible business activity will always remain the key issue for the region famous for illegal standards of living.

Legality of making a payment by Auger’s firm to help ensure the contract

According to the market conditions in the majority of regions in the world, it is unacceptable to give money in order to ensure the contract. According to the case, Auger started considering an opportunity of giving money in order to win the contract as long as he was going to establish business in Saudi Arabia. It might be acceptable in Saudi Arabia to make payments in order to ensure the contract and development of business in general. However, it is illegal to make payments in the United States in order to win the contract. It is also illegal to make any payments in Saudi Arabia. Nevertheless, companies tend to give bribes to the minister who will help them win the case. It is illegal and not fair to try to win the contract by paying off to the minister. However, it seems that it is a common procedure in Saudi Arabia, which makes it inappropriate for fair trade and any other business development. Saudi Arabia is used to living on terms of illegal activity penetrating into both economic and governmental segments. Behavioral patterns of Saudi Arabia are unacceptable for other parts of the world while the mentioned region has no intention to switch to another way of making business. There is no wonder that Saudi Arabia uses fake information in order to attract investments to its budget. This region does not develop because it attracts other companies in order to maintain upper tier authorities. As long as a king is the main source of power in Saudi Arabia, there is no chance to establish trusting and equal relations with the region.

Whether Auger’s firm is being singled out or other firms are making those payments

I believe that Auger’s firm is the only company, which is willing to make the payment. Saudi Arabia is famous for fraud and irresponsible business activity. It is not surprising that the government acts carelessly towards the development of international cooperation and integration. It means that the region is used to living based on the fraud, money laundering and lies. The minister could have told Auger about the payment in order to attract new investments to the government’s budget. It is not necessary for the local companies to make payments. They take part in the performance set by the government in order to encourage international business entities to make investments in order to develop business in the region. In addition, it means that the region is not interested in fair play. It strives to continue its illegal activity. It is possible to conclude that business should be careful enough to take decisions and develop business in the selected region. However, it is necessary to avoid cooperation and partnership with Saudi Arabia as long as the region does not offer fair and honorable support of business. If there is no other choice rather than Saudi Arabia as the basement for business development, or there is a chance of establishing a prosperous business entity in the region, then it is important to be careful and avoid companies with suspicious activity. In general, there is no economist advising to develop business in Saudi Arabia. Economists are aware of all threats and consequences of involvement into illegal activity of the region. Reputation and image can become the first target hit by the region’s business, economic and political activity.