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STRATEGY

The Shape of Things to Come

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The J curve represents the relationship between stability and openness. Each country moves along its own J curve, and the curve itself shifts up or down with fluctuations in the economy. Nations higher on the graph are more stable; those lower are less stable. Nations to the right of the dip in the J are more open, those to the left less open. As a country that is stable because it is closed begins to open, it slides down the left side of the curve toward the dip in the J, the point of greatest instability. So, for example, if Pakistan, Myanmar, or Cuba held elections next week, political turmoil would likely erupt. If North Koreans had access to South Korean media for a week, Kim Jong Il would have plenty to fear.

The irony is that the energies of globalization and growth in demand for key commodities are driving more businesses to contemplate ventures in politically closed countries, particularly China. But those same energies may destabilize the ground beneath unwary businesses' feet.

Last updated: Apr 1, 2007




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