The international business environment can be defined as the environment in different sovereign countries, with factors exogenous to the home environment of the organization, influencing decision-making on resource use and capabilities.
The political environment in a country influences the legislation and government rules and regulations under which a foreign firm operates.
The technological environment comprises factors related to the materials and machines used in manufacturing goods and services.
Economic factors exert huge impacts on firms working in an international business environment. The economic environment relates to all the factors that contribute to a country's attractiveness for foreign businesses, such as monetary systems, inflation, and interest rates.