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Considering a Business Relationship Offshore? Or, Is the One You Have Troubled?

The U.S. business community is globalized, in a sense–dollar diplomacy under changing political shadows-─nothing has changed. Volatility is always present everywhere. Let’s look at the most recently available global private consumption numbers from 2005: a. the globe’s wealthiest 20% accounted for 76.6% of consumption, b. the next 60% of all global consumers consumed 21.9%, c. while the world’s poorest consumed a meager 1.5%.[1] Now here is the kicker: the U.S. economy in 2016 generated 24.58% of the world’s Gross Domestic Product (GDP) ,[2] even though it only comprises roughly 1.5 % of the globe’s surface area (read: resources), about 6% of the globe’s land area[3] (again… resources), and less than 5% of the globe’s population[4] (read: consumers & producers). Sustainable? Only through continued globalization.

Continued globalization is essential for everyone, everywhere. For the uninitiated… finding and watching offshore investments can become analogous to watching television commercials, with no audio, through the wrong end of your binoculars, at 100 yards. Globalization is essential, here to stay, will accelerate, and is something everyone can benefit from. Applause is due for those investing in off-shore enterprises while at the same time prayers should be said that investors realize they will have to work differently, more earnestly, harder, and longer to create relationships which will both prosper and endure. There is nothing negative here as goodwill, mutual patience and understanding, toil, and cooperation can fulfill both the globe’s and the offshore investor’s destiny.

“Build-Own-Operate,” “Build-Own-Operate-Transfer,” “Design–Build–Finance–Operate,” etc., are commonly used terms. What is missing from this acronym smorgasbord is analogous to “Invest-Build-Own-Lose.” Recently, a director of an entity making its first plunge into international waters spoke privately, and unconvincingly, about “solid insightful investments” that suddenly and unexpectedly became absolutely breathtaking divestitures. The account clearly heralded a fundamental lack of “Ground Truth” (i.e., the proper know-how and know-who). Consequently, changes in the boardroom are probably forthcoming.

There are a litany of ways and means by which individuals, as well as small and large businesses alike, can build their portfolio of off-shore business interests. Better put, participate in and profit from the growing global economy – an economy which grows by default. Obviously, each country’s increasing pride of their own sovereignty has much to do with the actual means and level of cooperation afforded.

In fact, investor appreciation of each country’s (read: individual’s) birthright, self-pride (“face”) and sovereignty is essential to the long-term health of every relationship. One diminutive comment, one slander, one display of disrespect (including those resulting from bona fide cultural misunderstanding) can be catastrophic.

It is important to know that Western investors have legions of detractors out there. John Wayne and his bombastic style are indelibly etched into memories, and a much higher level of appreciation and understanding is expected, warranted, and valued. Western societies and all other societies and cultures now have, for the first time, needs which are as fundamental as they are reciprocal and understandable. Please keep in mind: the majority of the globe’s population, especially the most needful, work hard, are frugal out of necessity, and are not a burden on their respective society. In a sense, they seek only contentment. If you, as an American, see such existential sensibilities as beneath your station in life, please think about thinking differently. Strive for a new mindset and sustain it.

It is essential for those considering investing in, owning, and/or operating off-shore investments to unilaterally acquire the “Ground Truth” on a continuing basis. Experience indicates that Ground Truth is constantly evolving and impacts all; from the host country (foreign) workforce, through off-shore (foreign) management, through the (Western) headquarters boardroom, and on through to institutional investors… as well as national governance itself. Ground Truth is a necessity, on both the tactical and strategic levels.

ResultQuest can be instrumental in establishing needed Ground Truth in foreign lands, either proactive or reactive to offshore investments. Call us at 713/781-9040 to tap into our vast network of international sources and operatives, who can provide the “know-how” and the “know-who” needed in today’s multicultural environment.