Pest Analysis of Kazakhstan

PESTE analysis for Kazakhstan

PESTE analysis refers to Political, Economic, Social, Technological and Environmental analysis for businesses. Political analysis establishes the degree to which a government intervenes in the economy. Specific political factors include tax policy, labor law, environmental law, trade restrictions, and tariffs ad political stability. It also includes goods and services which the government intend to provide. These are referred to as merit goods. Those that the government does not encourage are called demerit goods. The economic factors involved are; economic growth, interest rates, exchange rates and inflation rate. Interest rate determines a firm's cost of capital. High interest rates raise the capital cost and would deter businesses. Exchange rates affect exports and importation costs of commodities. Social factors; these are aspects of cultures such as age distribution, health consciousness, career attitudes and emphasis on safety. Trend in these factors influence demand for a country. An aging population may imply low, work force and hence high cost of labour. Higher youthful population may imply ready workshop with relatively low cost. Technological factors; these include technology incentives, Research and development (R&D) activity, activity, and rate of technological change. Technological factors are significant in determining efficiency of production and outsourcing decisions. Technologically affect costs of production, efficiency, quality and lead to innovation. Environmental factors: these incudes weather, climate, and climatic change, which strongly affects tourism industry, farming and insurance. The growing awareness over potential impacts of climatic change is influencing how companies operate and their products, both creating new markets and diminishing or overhauling existing ones.