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International Business

Economic Expansion through Foreign Land Acquisitions and Leasing

The UN‟s FAO is critically alarmed by the latest developments in the situation with

large-scale land leasing by rich countries from poorer ones. The essence of the problem lies

in the fact that the historical aspect of geopolitics does not take into consideration the great

difference between the countries‟ economic potentials and the dynamics of their demands for

goods. This is especially crucial in regard to the most basic product on the market – food.

While the general debate circles around the question whether to place the blame on low food

production or inadequate distribution, the truth is ought to be somewhere in between. In other

words, there are reasonable causes to suggest that the current situation with global

malnutrition is caused by both poor food production and distribution1. Therefore, proper

investigation of the problem will require particular scrutiny to the issues encountered by

economically poor countries and the moral stop signs disregarded by the rich as well as the

global malnutrition background. Latest technological and politically inclined solutions are

also worth consideration, as they represent today‟s actual alternatives.

Aspesi et al. (2002) argue about the generally unfavourable food situation in West

Africa particularly naming Ghana and Nigeria as the countries with the worst malnutrition

conditions in the region. Studies show that there is pattern why economic instability comes in

strong connection with falling levels of food consumption. When global demand for food

grows, so does the consumption, which drags the food prices upwards. As a result, people in

poor countries (generally, in Africa and Asia) do not experience significant income increases,

whereas the prices keep going up and force family budgets to spend more for less.

1 De Greef Willy 2000; Challenging the Food Crisis: Is There a Place for Biotechnology in Agriculture?;

OECD Observer; vol. A, no. 221/222, p. 84.

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This situation also influences individual farmers and small companies who become

the victims of their countries‟ political regimes. They are not capable of struggling against the

governments‟ aspiration to prosper through the use of their lands‟ value to the maximum –

and giving green light to small companies is clearly not a solution for them. While some

might find long-term land leasing a good way to pour additional funding into the poor

country‟s budget in order to assist it in developing its infrastructure and eventually solve the

food problem with this funding, there is another thought in this area of argument that testifies

for the complete opposite. It is common knowledge that any country‟s budget comprises of

three major income sources – agriculture, industry, and service sphere.

While the proportions between those factors differ from one country to another

drastically depending on various background factors like geography, population, climate, and

natural resources, the idea of estranging from either of the three can bring major devastation

to the infrastructure instead of aiding it2. Although the leased land does not go overseas

physically, it does change the owner, which deprives the subject country of its major source

of food products and forces it to either increase imports or buy the food from the land‟s new

owner but by the prices suggested by the owner and only in case there is surplus.

Yusuf (2009) speaks about the international agencies‟ present-day policies regarding

agricultural and food subsidy for poor countries and underlines the fact that there is no unity

of opinion on how the food distribution should be regulated. Needless to say that the

research‟s subject was poised to aggravate the difficulty of coming to a common decision in

this area: While poor countries of Africa and Asia do struggle against economic instability

and malnutrition of their citizens, they find themselves ready to worsen the food problem by

leasing its farmlands in favor of long-term investment. Therefore, the initial moral dilemma

2 Sharma Shalenra D. 2009, The Other Global Crisis: Combating the Food and Humanitarian Crisis;

International Journal; vol. 64, no. 2, pp. 501-520.

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in this situation is tied to the generic poor country‟s government and its choice to solve the

problem of economic instability with decisions as rough as long-term land leasing of vast

portions of their territories.

However, the discussion would be incomplete if no particular numbers were named.

The drama lies in the fact that not only the popularity of the concept of major land leasing has

been growing throughout the recent years but also the magnitude of leased areas and the

contracts‟ lives. Present-day contracts cover areas of tens of thousands hectares and usually

have lifespans of twenty to fifty years3. The list of states willing to expand their agricultural

domain overseas mostly comprises of rich countries of Middle East (UAE, Kuwait, Qatar,

and Saudi Arabia) and Asia (South Korea, China, and Japan) with few exceptions. As it was

stated before, the rich countries‟ appetites have been rising and one of the latest long-term

lease projects has become a local pinnacle to this progression. South Korean Daewoo

Logistics expressed the will to sign a 99-year agreement acquiring one million hectares of

land on Madagascar.

According to Borger‟s (2008, n.p.) findings, the government of Madagascar assured

the global community and the investor that “an environmental impact assessment would have

to be carried out before the Daewoo deal could be approved”, but they did welcome the

investment. However, further development of the situation showed the unfavourable side of

the contract. Hance (2009) testifies that Daewoo Logistics had subsequently rewritten the

deal and proposed to acquire 1.3 million hectares of land from Madagascar instead of the

initially arranged 1 million and that this was the direct reason for the emergence of country-

wide uprising that brought down Madagascar‟s president Marc Ravalomana.

3 Borger Julian 2008, Rich Countries Launch Great Land Grab to Safeguard Food Supply; The Guardian;

November 22, accessed 01/06/11 http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-land-grab

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The aforementioned moral dilemma encompassing the poor countries‟ governments‟

readiness to sign similar contracts seems to be an a priori answered question for the latter.

Laos has already leased over two million hectares of its land to foreign investors, which

approximates to 15% of the country‟s “viable farmland” (Borger, 2008). Other significant

lessors include Ukraine, Kazakhstan, Sudan, Ethiopia, Congo, Tanzania, Libya, and several

other African countries. More importantly, the governments of the mentioned countries have

been noticed making advances towards potential investors willing to share their agricultural

land riches.

In addition to the already mentioned economic structure destabilization, these land

leases have another impact on the local population. FAO‟s President expressed dire concerns

with the ecological impact such exploitative tendencies might bring. Children of Madagascar

are already exposed to sever malnutrition, health and growth problems that emerged due to

land mineral depletion (Hance, 2009). There can hardly be any optimism in this direction, as

the situation can only worsen over time. In fact, this is where the second moral dilemma

arises: The foreign investors are well-aware of the consequences of direct land exploitation

for the local ecosystems, which means that by drawing up agricultural land lease agreements

they exchange their homes‟ well-being today for the rest of the world‟s starvation tomorrow.

It is common knowledge that growing certain crops means depleting the land‟s

mineral composition, which is why global practice suggests planting cycles that last several

years and include periods allowing the soil to “rest”. Nevertheless, the investors are majorly

interested in increasing their yields and not foreign ecology. As a result, the contracts like

Daewoo‟s imply tremendous yield expectations (5 million tons of corn annually) before all

environmental concerns. While morality and care for the future can doubt legitimacy of the

subject practice, they cannot help solve the problem of increasing food demand, which means

that the initial dilemma persists.

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This is where alternative solutions come in. The range of political answers to the

problem includes introducing certain policies that cut down the demand side of the problem.

For instance, China is rich in terms of agricultural land, but has recently encountered the

problem of insufficient watering. While its annual demand for food has been increasing due

to the growth of population and the economic development, the well-known “one family –

one child” policy remains actual. As a result, the country manages to control its demands

through rough yet effective laws. Studies show that the increase in food consumption can and

should be tampered with (Murphy, 2001). Another approach to solving the food problem

requires the application high-tech solutions, as this is the only way to cutting the issue from

its second end. In order to increase the food supply and save the land from severe depletion,

people need develop and apply biotechnological methods to agriculture. However, this

approach implies considerable spending and by all measurements qualifies as tomorrow‟s

solution, not today‟s.

Judging from the findings highlighted in this section, the practice of long-term land

leasing for agricultural purposes is only starting to unwind. The author‟s prognosis for the

subject is that economic disparity between rich and poor countries will increase over time and

the subject practice will continue expanding until there will be no more major territories to

acquire. It is difficult to nurture an optimistic opinion when the facts do not testify for the

popularity of dignity or farseeing. However, history can repeat itself in the future, when

another global crisis arises. To put it simple, the subject land leasing practice is an imperfect

solution designed by people in severe conditions. It is highly probable that when the land

refuses to bring enough food or the demand starts increasing out of proportion, people will

resort to more efficient solutions described before. The author‟s only anxiety concerns the

solution once labelled “tomorrow‟s” not becoming “yesterday‟s”.

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Nestlé: Operating in a Multicultural Environment through Multicultural Workforce

Nestlé is the world‟s largest nutrition company in the world with over a hundred years

of history of growth and development. It came into existence after the merger of two major

food companies both of which were founded in the nineteenth century – Anglo-Swiss Milk

Company was of British-Swiss origin and Farine Lactée Henri Nestlé Company was German.

However, by the moment the merger was finalized, both companies had production

operations in Switzerland, Great Britain, Norway, Germany, United States, and Spain4.

Today, its headquarters is situated in Switzerland, while its operations are widely

international – much more international than hundred years ago. Nestlé‟s origins suggest that

it was destined to become a company with multiple nationalities involved in its operations

and the obvious need to meet different requirements expressed by the multicultural

workforce. According to the latest data, Nestlé employs over 280.000 people worldwide and

operates in over 85 countries. This testifies for Nestlé‟s global recognition in terms of quality

and image. However, the company‟s approach to handling its vast workforce requires

particular scrutiny, as it is reasonable to conclude from all of the aforementioned facts that

personnel management is one of Nestlé‟s successes along with its products and global

development strategies.

It is worth noting that Nestlé is widely interested in the development of its local

market initiatives that would emphasize the company‟s wish to invest into regions in which it

operates through a large variety of methods. In other words, Nestlé is highly interested in

making its customers and employees perceive the company as open to locally authentic goods

and traditional tastes. While other companies may find it appealing to just develop products

oriented specifically on the local population, Nestlé goes far beyond this limit.

4 Timeline.com n.d.; Anglo-Swiss Condensed Milk Company - Nestle merger; Timeline.com; accessed 31/05/11

http://www.xtimeline.com/evt/view.aspx?id=129951

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Nestlé‟s open-minded attitude towards its operations in Japan can serve as proof to

this conclusion. Darren Megarry (2010) investigates the state-of-the-art strategy devised by

Nestlé Japan and describes how the company‟s leaders developed its Kit Kat brand locally.

After figuring out that in accordance with Japanese phonetics, Kit Kat would read as Kitto

Katsu, which literally means “surely win”, Nestlé decided to play a figure-of-speech trick

with their local customers by bringing up a postcard-like edible product called Kit Kat Mail

that would serve as a good luck charm to be given to each other and eaten by Japanese

students right before entering an exam. In order to take this idea even further, Nestlé

contracted Japanese post service to have the subject “mail” candy sold exclusively at post

offices. Megarry (2010, n.p.) concludes that, “even if you don‟t win the Grand Prize at the

Cannes Lions International Advertising Festival like the Nestle strategy did, thinking

creatively about how to reach your international audience and build loyalty can still be sweet

indeed”. Therefore, Nestlé‟s readiness to please its customers serves as a loyalty-attracting

factor for its employees as well.

There is no doubt that for Nestlé, the common known saying that people are the

company‟s primary asset, is not just an elegant phrase. Paul Bulcke, CEO of Nestlé‟s S.A.,

has said, “[W]e consider human capital development an important investment for the future

of Nestle” (CSR Digest, 2009). This statement is followed by factual data on the company‟s

employee training practices in Malaysia, where they have spent approximately 19.000 man

days of training in 2008 alone. According to the same source, Nestlé has announced a global

program for its employees that would focus on leadership, functional competencies, and

personal effectiveness. This example alone testifies for Nestlé‟s concerns about its personnel

regardless of geographic factors, as the program was designed to cover all of the company‟s

facilities.

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Robert Thompson (2011), a member of Nestlé‟s CSV Advisory Board, speaks about a

number of ways of reducing rural poverty. While the methods he describes can be perceived

as being abstract, there is a pattern that transforms them into exact suggestions that come

from the Nestlé-related context. The company is in the state of constant growth, which means

that it does not stop seeking new areas to expand to, and as new facilities open, it would

require adequate personnel to work there. Nestlé is open to buying out low-profit farmlands

from its owners and giving them jobs with fair salaries. In this way, several methods

suggested by Thompson merge into a new paradigm that satisfies the needs of both the

company and the potential employee. It is worth noting that the speech does not focus on

particular areas meaning that Nestlé is well used to its international status and its

multinational workforce.

Another situation serving as an example of Nestlé‟s highly concerned attitude towards

its employees took place in Egypt earlier this year5. On February 1, the country turned into a

boiling pot with hundreds of thousands of people protesting in the streets against Egypt‟s

current president, Hosni Mubarak. Needless to say, that such disturbance can call forth major

instability in any company‟s operations. This is why Nestlé evacuated twenty people of

expatriate personnel along with their families from the country in order to secure their lives

and health until the situation settles down. In addition, the company‟s leaders have decided to

shut down the operations in Egypt allowing 3.000 of its employees to stay indoors to avoid

injuries in the street. There can be only one conclusion here: Nestlé did not put profits before

its personnel in this uneasy situation and preferred losing today in order to win tomorrow.

Nestlé is also widely concerned with its employees‟ wellbeing and health, constantly

initiating certain programs and policies that would be beneficial for the company‟s

5 Agence France-Presse 2011; Nestle Shuts Down Plants in Egypt; Industry Week; February 1; accessed

31/05/11 http://www.industryweek.com/articles/nestle_shuts_down_plants_in_egypt_23793.aspx

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workforce. While some of the examples brought up earlier have generalized nature and testify

for Nestlé‟s wish to nurture all of its 280.000 army of employees, the head staff in Vevey also

leaves the freedom of expression in this direction to its regional divisions. A project called

2009 Global Corporate Challenge was conducted by Nestlé UK and involved 1800 people,

which sums up to 36% of the company‟s workforce in the United Kingdom6.

The magnitude and the spirit that accompanied the initiative have made it the

country‟s largest corporate health enterprise to date. According to the results of the study

carried out after the program was finished, Nestlé‟s employees have displayed significant

increase in their health indicators, lost weight, and improved their general condition.

Moreover, the study has shown that Nestlé‟s employees have entered the program with

extremely positive health test results, which means that the company is concerned with its

staff‟s health on a daily basis well beyond show-off programs.

Nestlé is obviously highly interested in the well-being of its employees. Its policies

encompass a variety of ways for the company to approach its workers. They include direct

and indirect influence methods, all of which, as proof suggests, hit the target. Whether it is

through generosity towards potential employees or through the actual employees‟ relatives

and friends, through scheduled healthcare programs or evacuation missions in extreme

circumstances (it is worth noting that the operation in Egypt involving roughly fifty people is

a great testimony to Nestlé‟s dedication to its workers) – Nestlé has proven the

comprehensiveness of its strategy.

More importantly, Nestlé‟s approach to personnel management is not self-centered. In

other words, the company does not carry out its policies and wait blind dedication in return.

6 Batman David 2010; Nestle UK’s Largest Ever Corporate Health Initiative Produces Outstanding Benefits;

Employee Wellness Magazine; accessed 31/05/11 http://www.employeewellnessmagazine.com/business-

spotlight/nestle-health-initiative-benefits/

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To the contrary, all of its methods are directed by integrity and deliberateness. As a result, the

company continues on prospering and its workforce remains highly trained and secured.

As a conclusion to the conducted research, there are two major ways in which Nestlé

carries out its employee-oriented approach in the context of the workforce‟s multinational

structure. Firstly, there is company-wide range of policies that protect Nestlé‟s employees‟

rights and freedoms. These policies bear a mark of tolerance that signifies the company‟s

indifference towards regional conditions and issues – regardless of the area, Nestlé‟s

employees are sheltered by the same umbrella of care.

As a complete opposite to the previous point, stands the second company-wide policy,

which lies in the freedom of expression granted by Nestlé‟s headquarters to the regional

administrations. This side of the employee-oriented approach allows regional divisions to

carry out self-government operations that would be beneficial for the company and its

workforce in particular countries. Indeed, adopting two mutually contradictory approaches is

dangerous, as it is nearly impossible to predict, which of the two should be prioritized in case

of unformatted force majeure. However, the practice has proven to be efficient and has been

so for over a hundred years. While some concerns might arise, it is clear that upright motives

that drive the company today will find a way to orient in a dire situation. By incorporating

those two opposite approaches, Nestlé created a major precedent in the global corporate

practice that had made it the world‟s #1 food and nutrition company.

Management as a Practice

According to Henry Mintzberg‟s (2004, n.p.) insight, “Management is not a

profession, nor is it science. It is a practice that depends mostly on craft and significantly on

art”. This particular statement has significant underlying experience and a line of successive

conclusions. These conclusions made Mintzberg literally crash the newly graduated MBAs‟

dreams of bright corporate management future they drew from getting their degrees. The

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author of the current research will try to disclose those intermediary findings and deduct

additional lines that Mintzberg cared to omit in his article. Another mission of this particular

section of the paper is to build up a line of protection against Mintzberg‟s critique of

“classroom managers” and their absolute disability to compete against experienced managers.

Firstly, the author would like to discuss the points that express opinion-free facts

about management and the way it is carried out. The statement that management is not

science or art is only partially true, as it is not exactly one of those, but a concept that

includes features of the two instead. In other words, management is a practice that comprises

of art, science, experience, intuition, and luck.

Management as a science. Raelin and Cooledge (1995) argue that management can

easily be perceived as a science and the observer would hardly find any evidence of this

viewpoint being wrong. This is mostly true because science deals with analysis, facts, and

systems, and the practice of management relies on those pillars heavily as well. Regardless of

the managers‟ qualitative attributes, they ultimately have to be able to see the division or the

company they were entrusted with as a system that comprises of integral parts that can and

should be re-arranged and re-designed, controlled, optimized, and maintained.

Systematic approach allows the managers to structure their activities, keep track of the

progress, identify operational clutter, and carry out other managerial control functions. These

first level operations open a wide range of opportunities for the managers to improve the

company through various secondary interactions with the structure at their hand. Here are

some examples of these interactions:

Optimizing interdepartmental logistics and information exchange;

Removing or merging minor operations to save time;

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Re-scheduling particular processes to coincide with output peaks of other

divisions or season-related tendencies (in regard to customers, resources,

investments, political fluctuations, etc.);

Consulting with exterior specialists about service or production improvements;

Carrying out trainings, corporate initiatives, and other events to increase the

division‟s / company‟s productivity;

Other operations dependent on data gathering and processing.

Therefore, depriving management of its scientific component is clearly unimaginable,

as management itself is built upon science. Moreover, the widely regarded conflict between

leadership and management in companies comes from the fact that managerial approach is

significant by its strictness and structure7. While the real-world managers are far from being

black or white in terms of structure-dedication or structure-evasion, the fact persists –

managers do rely on science.

Management as an art. There are facts that testify to the complete opposite from the

previous point in terms of the managers‟ relationship with non-systematic methods. One of

these facts is the popularity of the SWOT analysis and similar practices among corporate and

project managers8. While the two initial letters of the acronym come in strong connection

with scientific approach to management (the company‟s strengths and weaknesses are clearly

derived from factual data processing), the latter two create a controversy because finding out

the firm‟s / project‟s opportunities and threats requires skills that come from beyond science.

Successful managers (indeed, the author has moved to a particular kind of managers

here) are capable of not only analyzing factual data and refurbishing their divisions and

7 Roof Joseph & Presswood Kristy 2004; Is It Leadership or Management?; College and University, vol. 79, no.

4, pp. 3-8.

8 Ou Wei-Ming & Chai Kang-Wei 2007; Use of Leadership and Differentiation Strategies by Professional

Service Firms: a Case Study; International Journal of Management ; vol. 24, no. 3, pp. 477-488.

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companies but also developing new policies from scratch, revolutionizing the operations, and

suggesting new expansion ideas to their superiors. Evaluating the opportunities and threats

that stand before the company requires vision, a characteristic that cannot be learned from

textbooks but, rather, developed over time through vast amounts of practice. However, vision

alone is not enough, as the art of management implies further skills a professional manager

should develop. Those include design, wit, persistence, and intuition.

After identifying a potential opportunity, the manager then has to design the best way

of implementing it through incorporating both scientifically-inclined approach and clear

understanding of the company‟s operations. Wit and cunning are required to identify those

parts of the design that are not crucial and can be cut off in order to simplify the subsequent

optimization procedures. The manager has to be persistent in promoting the concepts that

have laid down in the foundation of the new improvement project, as often things do not go

as planned from the start requiring the process to liven up. Finally, when the improvement

has been approved and the re-design operations are under way, the manager has to identify

the newly emergent problems before they become a pressing matter. This stage requires both

understanding of the corporate mechanisms and intuition to separate crucial obstacles from

routine problems that would be grinded up by the process without external interventions.

All of the above means that management is an art and a science at the same time.

However, it is also fair to say that management is not limited by those concepts and in fact is

a unique practice that involves a lot of knowledge, experience, and skill. Moreover,

successful managers also play the roles of leaders, which means that their modus operandi

embraces such vague concepts as philosophy and spirit. Mintzberg does not speak of these

concepts because they are way beyond scholarly management programs. Talented people

who work long enough in the sphere of management are pre-determined to develop their

unique attitudes towards the way corporate management is carried out. In other words,

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successful individual managers are distinguished by their traits, which make them unique and

even more authoritative.

Mintzberg is right in saying that new MBA graduates lack skill and practice to carry

out the duties they were trained for. There is also no doubt that these youngsters possess

vigor and analytical inclination instead of being comprehensive or cautious. However, those

experience managers praised by Mintzberg lose those very vigor and analytical inclination

over time, as they dissolve in the vast number of situations they encounter and mediocre

skills they develop over time. It would be ridiculous to assume that all of their professional

knowledge is useful, as most of the circumstances that comprise precedents scatter away over

time. Thus, most cases are unique and the best those experienced managers can draw from

their experience is experience itself, whereas MBA graduates are given the opportunity to

process raw information and derive professional conclusions – direct and solid.

One might argue that there are no simple answers and all smart conclusions are

underpinned with knowledge. Indeed, managers must put a lot more effort into thinking over

their decisions than other professionals, as there are stakeholders who depend on those

decisions. However, it is the quality of material processed by students and actual managers

that makes the difference. The latter deal with routine situation day after day, which blunts

their perceptive skills and the aspiration for achievements, unless they prefer revolutionizing

every working day they have, whereas the former deal with model and key situations

incomparably more complex than the real-world managers‟ daily routine. However, it should

be considered that this does not apply to all levels of management, as top managers do

encounter difficult cases every day, though comparing students to those sophisticated

professionals is clearly absurd.

Carr (2002) argues that compared to the old concepts of management, the new ones

may seem out of context due to their art-wise gilding. This is because during the twentieth

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century, management and administration involved scientific approach alone. Nevertheless,

the times change and the progress demands adaptation to new circumstances and regularities.

This is why today‟s management is far more than science or art.

The author‟s personal opinion goes in tight relation with the so-called Sturgeon‟s

Law. In this particular situation, the Law‟s application is the following: Mintzberg is right on

many points, although he got carried away by his debate and some of his conclusions are too

patronizing instead of staying advisory. Therefore, his conclusions deserve study and

consideration, while MBA graduates should bear in mind that the training they underwent is

far from being as useless as Mintzberg describes it. Moreover, some skills developed during

the study process should be kept in the same state they were after graduation throughout the

long years of managerial practice. Impatience should be transformed into controlled anxiety

that would drive the managers to new achievements and maintain their desire to reach out, as

there is no worse manager than the one without aspirations. Analytical inclination should be

kept in one hand and the artistic approach – in the other. Finally, good managers have to

consider the experience they accumulate over time, but remain always ready to solve an out-

of-range conflict with the same clarity of mind they possessed back in their classrooms.

Personal Beliefs Contributing to Australia’s Economic Development

There are many ways in which a country may contribute from religious / political /

ethical beliefs of its population. However, as Haiti‟s example suggests, there is also a high

probability of those beliefs to turn out harmful. Further investigation requires at least minor

insight into the history of Australia‟s cultural and economic development. Findings by

Chaundhri and Wilson (2000) suggest that Australia‟s economic growth in the twentieth

century to the present-day state of well-being came in strong relation with such aspect of

economy as savings. However, the previous stage of the country‟s history displays a

completely opposite tendency: During 1861-1899, Australian economy was heavily

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dependent on foreign investment and importation of labour. Those mostly came from Great

Britain, which determined the direction of capital and mineral resources outflow of that time.

It is understandable, why the new nation of Australians did not consider the new land as

home for their descendants: Australia was very rich with resources and territory compared to

Great Britain and a natural conclusion to come upon is that it was a convenient mine to

process. While the country‟s economic growth was among the highest in the world during

that time, Australians preferred keeping their savings in Great Britain – the home of stability.

The situation started changing in the beginning of the twentieth century when the

majority of Australia‟s investors and business partners became focused in the Asian region.

This occurred due to the natural reason of Asia being closer to Australia than any other

region, including the Great Britain. As a result, China, Japan, and South Korea turned into

Australia‟s principal benefactors and investors. This turn of events put a start to the country‟s

development of its own savings system and the rising sentiment of patriotism.

Present-day Australia is a developed country that does not depend on old colonist

partnerships and has its own range of policies and attitudes that determine its future. Its

unique geopolitical background generates various economic opportunities that only need to

be descried. It is worth stressing that Australia has become the subject of close scrutiny for a

number of international organizations, one of them being UNESCO9. Although the country‟s

newest history is relatively short, the aboriginal inhabitants of Australia represent a major

interest for scientists and tourists – not to mention the ecology and recreation sights.

However, Australia‟s future has a strong correlation with mentality of its population,

which returns the research to the initial objective of identifying which of the author‟s

personal beliefs can affect the country‟s economic development perspectives and in which

9 Kate A. Matysek, Elaine Stratford, & Lorne K. Kriwoken; The UNESCO Biosphere Reserve Program in

Australia: Constraints and Opportunities for Localized Sustainable Development; The Canadian Geographer;

vol. 50, no. 1, pp. 85-100.

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way. As it was stated before, Australia is a country of patriots who are proud to live on this

land and are willing to contribute to its prosperity as much as they can. The author is no

different from the rest of the Australians in terms of patriotism, which draws certain

conclusions.

Firstly, the country‟s history clearly shows that the present day economic

development is the result of certain views adopted by the Australians somewhere near the

brink of the twentieth century. Indeed, setting free from the dependency on the former

colonist has proven beneficial in terms of both economics and politics. As a result, the public

opinion also shifted towards patriotic beliefs. If one were to suggest that history could have

gone otherwise, today‟s Australia would be a lot different from what it is: It would still be a

mining colony whose inhabitants are only interested in eviscerating the land and getting the

largest profit off of it.

While some might underestimate patriotism, a logical chain of conclusions would

prove that it is one of the main reasons there is such country as Australia on the world map

today. Patriotism made the new land‟s settlers to call this place home. As a result, Australian

investments and savings changed their directions from outside to inside the country.

Consequently, an interest to refine the continent for more comfortable living emerged. People

realized that this would be the place where their children would grow up and raise children of

their own. Therefore, the author‟s resolute patriotism is the pillar for Australia‟s economic

growth, as caring for the country is the necessary first step towards prosperity.

Secondly, religious beliefs remain a controversy in many countries in the Middle East

and Europe, while Australia managed to avoid these issues. The author would prefer keeping

personal religious beliefs undisclosed, as this matter is completely personal and concerns

every individual alone (as long as they are not extreme). Luckily, the environment in which

the author was raised had zero chance of inspiring such beliefs, so those beliefs are nothing to

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be afraid of. To the contrary, they hardly influence the author‟s sober reasoning, which goes

in line with the country‟s general religious line10

.

Indeed, while most Australians are religious and stick to their beliefs, religion plays

little role in public life. Nevertheless, everything is learned through comparing and this issue

is not an exception. In a religiously unstable environment, adhering to any line of belief

would be dangerous. Australia is perfect in these terms: It is a majorly religious country

whose inhabitants are not interested in intervening into others‟ lives to propagate the right

religion. Therefore, the author‟s point here is that the moral unity is Australia‟s equivalent to

religious spirit in foreign congregations of believers.

Thirdly, the author is an open-minded person with comprehensive perception of

events around the world and a strong sense of integrity. These two qualities are beneficial for

both the author and the country, as it were the people with ingenuous insights into the future

who build today‟s Australia and not the greedy narrow-minded miners of the nineteenth

century. While accumulating riches for oneself can be more beneficial today, this is a

particularly weak line of behaviour in the long run – mainly because no fortune is enough to

buy immortality. The common belief is that people continue on living in their children‟s eyes

is overly romantic, although this phrase does bear the key to the actual revelation.

The truth is that the greatest riches are not accumulated but invested. Accumulated

goods would sooner or later change the owner and the results of investments would remain

the public heritage, which would truly become the monument to a person‟s immortality in the

eyes of those who would come afterwards. Needless to say that investing into the

development of the country‟s cultural and social funds is the best investment portfolio

imaginable.

10

Mark Lyons & Ian Nivison-Smith 2006; Religion and Giving in Australia; Australian Journal of Social Issues;

vol. 41, no. 4, pp. 419-436.

19

The fourth and final point is the author‟s belief system is the attitude towards any

perspectives in general. There are pessimists and sceptics, realists and optimist, but the author

prefers being an optimist in words and a realist in actions. In this way, the author attracts

success and good opinions through displaying “belief for the best to come”, whereas the

author‟s actual every day modus operandi encompasses accurate deduction methods and a

fine analytical apparatus. These two components of the author‟s general belief system take

part in the decision development processes and adjust momentary reasoning.

As one of the previous sections of the paper suggests, the ability to stay reasoned and

to be open to new information are the primary requirements for a good MBA. Therefore,

some part of the author‟s belief system also benefits to the professional skills system, which

is both convenient and useful. It would be natural to conclude from these findings that the

author‟s belief system is Australia‟s uncashed asset that awaits its turn to be played.

As a result of the previous research on beliefs and their impact on the economic

development of Australia the author would like to suggest several final statements:

The author‟s patriotic beliefs are a generic quality and hardly be perceived as

being beneficial to the country unless they are consider as an integral part of

the nation‟s patriotic fund – in that way the proverb about the fist being

stronger than either of the five fingers separately would be an accurate

metaphor for the argument;

Religious beliefs can be beneficial in certain countries, but in Australia,

tolerance and good will are valued above all, which means that modest

religion beliefs are an indirect asset to the country‟s prosperity;

The author‟s open-mindedness and the set of behavioural skills / beliefs are a

major asset to the personal bank of qualities, which, in turn, is a benefit for

20

Australia as a country in constant need of skilled MBAs with sober reasoning

and Maecenas‟ attitude.

National Soft Power

Soft power is the direct opposite to hard power, while both are the means of winning

over international political skirmishes11

. This functional similarity eases the mission of

defining the former. Hard power implies rattling with arsenals, threat, and open conflict.

While such means can be perceived as barbaric, it did shape the world it is today and,

unfortunately, will remain #1 choice for those countries who are interested in results “no

matter the cost”. As the mutual relation of the terms suggests, national soft power is the direct

opposite to hard power and provides the chance of peaceful conflict resolutions through the

subject country‟ considerably attractive image in certain terms, which acts as a blunting lure

for the opponents. Therefore, the national soft power is the ultimate weapon in the political

games of the twenty first century.

There are numerous illustrations of national soft power spread throughout the globe.

The most obvious example are the United States whose image of well-being has been an

ultimate attractive factor for many generations and has dragged particular results

unintentionally. For instance, the currency of such a wealthy state was meant to become

globally recognized. However, it was the US and not UK responsible for the spread of the

English language, which resulted in it becoming the de facto international language today.

Some even suggest that the United States government should open up a network of English

learning centres in the major cities of the world in order to spread the concept of American

11

Donna A. Cristo 2005; Soft Power: The Means to Success in World Politics; American Economist; vol. 49,

no. 2, p. 99.

21

way of life even further and thus broaden its area of soft power influence in order to reach the

general public merely willing to study a foreign language12

.

A more recent example of a rapidly increasing national soft power can be found in

Asia: China demonstrates one of the world‟s largest soft power potentials. According to

Sutter‟s (2007) findings, China‟s advance on the global arena coincided with the significant

downfall of the United States‟ authority in Asia, which automatically turned China into the

primary political force in the region. Some of the China‟s primary strengths in terms of soft

power include its widely covered rapid economic development, Chinese wit and

pervasiveness, the several thousand year old heritage carried by the Chinese anywhere they

expand. All these factors attract other countries and their citizens, as China represents

tremendous financial success that came to existence unnoticed through the application of

basic rules of business construction – dedication and persistence.

Altunisik (2005) provides this research with yet another example of a significant soft

power in Asia, more particularly – in the Middle East. In her opinion, Turkey can become a

major player and an attractive force among other Islamic countries in the region due to its

success in successfully merging its Islamic roots and democratic regime. Indeed, Turkey has

managed to enter the international community and the EU with its head held high. However,

the number of additional features that come along with the status of a major soft power bearer

includes the status of a model country. In other words, the countries that look up to a soft

power bearer not only will to negotiate in the subject state‟s favor or resolve conflicts

peacefully, but also perceive this country as an example from which they should learn.

Surprisingly, numerous Turkish officials rigorously denied the suggestion that is was

Turkey‟s original goal to become a model country for its Islamic neighbors (Altunisik, 2005).

12

Thomas Molloy 2006; Projecting Soft Power through English Language Training; DISAM Journal of

International Security Assistance Management; vol. 28, no. 3, pp. 110-120.

22

It is only natural to conclude that certain results (even the positive ones) can come into being

without direct aspiration towards them even in the context of global politics.

The reasons why countries wish to increase their soft power can vary widely. While

some seek economic prosperity and open space for foreign expansion (China being the most

prominent example), the others can be driven by more universal motives. For instance, the

United States full-scale war on terrorism has transformed into a multi-level set of operations,

which includes both hard and soft power (Bellamy, 2004). It is easy get puzzled by the

United States‟ reasoning on this issue, as terrorists should be fought and not befriended.

However, there are always parts of the picture that often remain unnoticed – there is civilian

population that is not interested in urban firefights and their home countries being hated by

the rest of the world for the actions they do not support. This is why the United States

developed a system of means to improve its image in Southeast Asia in order to simplify its

anti-terrorist operations in the region and save innocent lives that might have become

crossfire victims.

Another instance of soft power in the United States is its population and certain

political and public figures. Knutsen and Pettersen (2009) argue that one of such attention-

attracting powers is the well-known political activist and film director Michael Moore. While

Moore‟s original intentions are clearly anti-American (in terms of stereotypes, common

absurdities, and other areas), the effect his actions cause is directly the opposite. Needless to

say that such persistence in exposing unfavorable truths draws a lot of attention. However, it

is Moore‟s self-criticism that attracts the rest of the world to the United States, as people

perceive those films and programs as an entire nation‟s cry for help. Simple psychology tells

that the easiest way to make a friend lies in complimenting the person of interest – or

diminishing own qualities before this person. Indeed, the reasons for developing national soft

power can be extremely varied as well as the means to carry out this development.

23

France is a multi-dimensional example in terms of soft power application. Dinerman

(2000) and Tardy (2004) agree on the point that today‟s France is very different from what

the country was like right after de Gaulle‟s return to power in 1958. France has since

shriveled and became integrated into the EU so greatly that it cares for European defense

systems as much as it cares for its own. Another issue involving France is its conflict with the

United States and the open demonstration of its good will and weaponless crisis resolving.

The EU‟s and NATO‟s military potentials are being constantly measured and compared by

opposing parties, which brings about sad associations with the Cold War.

The not so long ago development of the energy crisis on the Middle East provoked

and escalation in the US-France relations. The United States‟ intervention into Iraq became a

great concern for France because it is the permanent member of the Security Council and

wields major control levers of the European Union‟s military force. This confrontation could

have spilled into a full-blown military conflict if either of the countries failed at not hitting

their respective red buttons. However, the peaceful resolution brought poor political results,

as it was not completely peaceful: EU in the face of France did not stop the United States

from entering and unfolding an actual was in Iraq, which damaged the image of both France

and the Union. As a result, the France is in dire need of political rehabilitation and is doing its

best to restore what was believed to be its general line: During the last several years, France

has been opposing itself to the US as being a peaceful country that would not hesitate to

confront tyranny. Historical facts have shown otherwise.

Now, France wishes to use all of the soft power it has to promote its peaceful image to

the rest of the world and in this way express despise towards the United States‟ way of

putting military force before negotiators. However, this may be not the best time to carry out

this plant, as the US has a new president and undergoes a major “change”. Moreover,

researchers argue that even though the policies brought over to the front lines of the conflict

24

by two sides are completely opposite, the underlying reasoning can be very similar (Tardy,

2004). France‟s peaceful way of solving conflicts is a screen as obvious as the United States‟

hard force application tendency, although the latter do not hide the fact that they are willing

to take what they want by force. France conceals its individual interests under the white

knight bravado, which does not make then less individual. Consequently, the French should

question themselves whether entering an active phase of soft power promotion is a good idea,

as their actual motives (establishing firm status as the leader of the EU defenses) have already

been revealed.

The Chinese government, as it was already mentioned before, is primarily interested

in the economic and not political aspect of the soft force game. In addition, China never tried

to hide its primary aspiration towards global economic expansion and development. This

difference in approaches to utilization of national soft power stresses the importance of

scrutiny towards the high and mighty of the globe in order to uncover their true motives and

intentions. As a variant, one might stumble upon the already mentioned example of Turkey

where there was in fact no motive at all.

China‟s use of its national soft power has a strong business inclination in its

underpinning and application. In fact, the two forces (economic success and the soft power

that was generated as a result) came into correlation and now remain in a closed-circle

relationship: China‟s further economic success increases the influence of its soft power,

which, in turn, results in further economic growth.

25

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