Politics ... you really can't get away from them. Whether it is zoning concerns in your local community, which candidate running for State or National office you feel is going to be best for your particular business (or business in general), or even the internal politics of your own company – politics play a role in the way all of us do business whether we like it or not. While most of the time the politics in question are, at worst, the cause of some minor concern or irritation, when expanding your business into the European marketplace, certain aspects of politics take on a new, and often crucial importance.



Historically, European politics have been perhaps the most complicated the world has ever seen. This is not difficult to understand when you consider that the majority of the world's wars in the last five hundred years have taken place on European soil, between European nations. Factor in the rise – and eventual fall – of Soviet bloc Communism and the evolution of the marginally effective European Common Market into the extraordinarily powerful European Union, and you find yourself facing perhaps the most intricate and complex set of interlocking, overlapping political considerations the world has ever known. And make no mistake about it, the vast majority of European citizens love politics.

While the political intricacies of Europe and the historical imperatives for them are the stuff of University courses and thousands of books which cover every conceivable permutation in incredible detail, these are mostly of use and interest to diplomats and historians. However, for the American business looking to expand into the European marketplace, there are a few political issues which need to be kept in mind. These include:

• General perception of America and Americans. While it is certainly not at what most analysts consider to be a dangerous low, the general perception of the United States by the majority of the European population is not terribly positive at the moment. The current Administration is viewed by many sectors of the European populace as having a “cowboy mentality”, and the current ongoing conflicts in Afghanistan and Iraq – while marginally supported by many of the Governments – are very unpopular with the majority of the citizenry in many European nations. The government of the United States is viewed in many sectors of Europe as being arrogant, and this perception is, on occasion, carried over to Americans as well. While it is certainly not always the case, these perceptions can negatively impact your bargaining position. Two things you can do to help avoid this happening are:

1. Until you are comfortable with your European partners – or until you are fairly certain that you agree with them on issues – avoid discussing world politics whenever possible. Remember that Europeans tend to be far more interested in World politics than Americans, and what would probably be a minor disagreement with a fellow American could strain relations with your European partner.

2. Always show proper respect and deference. This could perhaps go without saying, but there is simply no better way to combat the perception many Europeans have of Americans as being arrogant. Always remember that you are a guest in their country, and comport yourself accordingly.

• Expanding into European Union verses non-European Union nations. Generally speaking, you will be likely to find yourself more comfortable and at home expanding into European Union member nations than those nations outside of the EU. The reason for this is that both the governmental regulations you will encounter and the paradigms and cultures of the specific businesses you partner with will tend to be more familiar and more westernized than you will find in non-EU nations. Additionally, the majority of EU nations have adopted the Euro, and the Euro continues to be one of the most stable currencies in the world. It is important to keep in mind, however, that while all EU nations have agreed to a common set of regulations with which you will need to comply, each member nation will have their own set of requirements, guidelines, regulations and tariffs with which you will need to comply as well.

Outside of the European Union there is still a lot of money to be made, but the challenges you will face can be more complex, and your risks can be greater. Many of the Eastern European nations – and particularly those that have either gained their independence or actually been formed for the first time in modern times as the result of the fall of the Soviet Communist bloc – are neither economically nor politically stable as nations in the EU. Ethnic and religious factors can, in some cases, greatly impact the political and business cultures of these nations. In some EU nations, corruption is an everyday part of both political and business life and in some cases the only option you will have to get anything done will be to slip someone in the government a considerable about of money for their “cooperation”. While this is certainly not always the case, you will need to make certain that you have expert advice on how things are and aren't done – and you will need to weigh your risks against potential profits very carefully – before considering expansion into some non-EU nations.

• Lines of Communication. There was a time, less than a quarter of a century ago, when communication with larges parts of Europe was an “iffy” thing at best. Part of this was politically motivated as some governments did not encourage the free flow of information to their citizens, while part of it was based on the continent not being as technologically advanced as the United States. By in large, both conditions have changed in almost all of Europe. Particularly in the area of technology – and specifically in terms of the Internet – large segments of the European markets not only equal but exceed the United States, providing both faster and more reliable broadband Internet service and, in many cases, providing it to their citizens and companies completely free of charge. Communication between partners is important in any business venture, and in the last few years many of your partners in Europe will have become accustomed to virtually instant communications. In most cases, it will be imperative that you upgrade your existing systems, if necessary, to meet this need.

Politics ... you really can't get away from them – and as you look to expand your business into the markets of Europe, you can't afford to ignore them either. It is strongly advised that before you start any form of expansion, you get advice and counseling from someone familiar with the markets you are looking to move into. At the very least, understanding the political climate of the nation or nations you want to expand into can provide you with a guide for developing a winning strategy for that expansion. And at the most – in some cases – it can make or break the success of that expansion.