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4 - Global Environment… (cont.) Other Trade Alliances African Union (AU) -the 53 African nation came into existence in July 2002 with the vision of building an integrated, prosperous and peaceful Africa South Asian Association for Regional Cooperation (SAARC) –composed of seven nations ( India, Pakistan, Sri Lanka, Bangladesh, Bhutan, Nepal and the Maldives) started eliminating tariffs on January1, 2006 The World Trade Organization A global organization of countries that deals with the rules of trade among nations. Formed in 1995 and evolved from the General Agreement on Tariff and Trade (GATT ), an agreement in effect since the end of World War II Understanding the Global ….(cont.) Managing In a Global environment Economic environment Market economy an economic system in which resources are primarily owned and controlled by the private sector Command economy an economic system in which all economic decisions are planned by central government The cultural environment (cont. ) Long-term orientation people look to the future and value thrift , and persistence. Leisure time is not important and believe that the most important event in life will occur in the future Short-term orientation values the past and present and emphasizes respect for tradition and fulfilling social obligations. Leisure time is important and it is believedthat the most ipmportant event in life occurred in the past or present The GLOBE Framework for Assessing Cultures The Global Leadership and Organizational Behavior Effectiveness (GLOBE )research team identified nine dimensions on which national cultures differ GLOBE Nine Dimension Assertiveness: the extent to which society encourages people to be tough, confrontational, assertive and competitive versus modest and tender. equivalent to achievement dimension Future orientation: the extent to which a society encourages and rewards future-oriented behavior such as planning, investing in the future and delaying gratification (long/sh