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GS - Icecream Nestle in Cuba_final.pptx - Nestlé ice cream...

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NICCOLÒ BELLAVITIS,CATALINA ESTEFÓ, LUKASHAIMERL, ISIDORA OYARCE &JÓZSEF VÁRADINestléicecream inCuba1
2AgendaCase ContextHow would you characterize the operating environmentfor foreign firms in Cuba?Has Nestlé´s ice cream business in Cuba been success?How can Nestlé position itself for future success, givencurrent market position and potential changes on thehorizon? What are the prospects for future investment andeconomic growth in Cuba?2
3AgendaCase ContextHow would you characterize the operating environmentfor foreign firms in Cuba?Has Nestlé´s ice cream business in Cuba been success?How can Nestlé position itself for future success, givencurrent market position and potential changes on thehorizon? What are the prospects for future investment andeconomic growth in Cuba?3
1961CubaCastro andhis GuerrilaarmyOverthrowUS-supporteddictatorshipofFulgencio Batista1959CastronationalizesmostbusinessesIncludingAmericanbusiness. US breaksdiplomaticrelationshipsandordereconomicembargo1960CastroproclaimshimselfcommunistStrengthenstieswith Soviet Union.TheUSfailstotake down Castroin “The Pigs Bay”mission.Missile CrisisSoviet missiles hiddenin Cuba, bringing theUS and Soviet Unionalmost to nuclear war.After13daysthemissiles were removed.1962Cuba’seconomycollapsesWiththedisintegrationofSoviet Union1991US createdHelms-BurtonActpenalizes foreign companiesthat do business in Cuba bypreventing them from doingbusiness in the U.S.199610.96 million people (1996)25.02 billion USD dollarsSource: “Cuba Profile” -04/10/20174
5AgendaCase ContextHow would you characterize the operating environmentfor foreign firms in Cuba?Has Nestlé´s ice cream business in Cuba been success?How can Nestlé position itself for future success, givencurrent market position and potential changes on thehorizon? What are the prospects for future investment andeconomic growth in Cuba?5
Cuba’s Business Climate Indicators6
Cuba’s PESTEL Analysis- Castro’s communist and totalitarianregime- One party state- FDI highly regulated with limitedduration- Political Stability and Absence ofViolence/Terrorism- Government Effectiveness: 19,67%- Dual currency- Salaries were paid in CUPsand foreignfirmsprices in CUC- Economic crisis after Soviet Union Fall- Little to none financial information- Resource seeking foreign investment- Decrease in agricultural production- GDP: USD 25.017 bill (-17% growth)-United States embargo against Cuba- Limited domestic Cuban consumermarket-High Education level-Customer sophistication-High cultural heritage-Population: 10.961.012-Labor Force: 4.631.125-Unemployment 7%-Life expectancy: 75,7 years-GNI per capita: USD 2.700-Access to electricity: 95%-Low access to internet and mobile se-No advertising possibilities-Regulated by government-Island, geographic isolation-High tourism because of sights and c-Climate: tropical savanna-Cows: 57.143-Agricultural land: 62%-CO2 emissions: 2,46 tons per cap-Employees are hired by the governm- dairy market regulations

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United States embargo against Cuba

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