International Business

Porter’s diamond theory describes how nations have gained competitive advantage from the four determinants highlighted in this theory. The four determinants include factor condition, demand condition, supportive industries, firm’s strategy, structure and rivalry and government. In this paper we compare Japan and South Africa with regard to the utilisation of these four factors to gain comparative advantage.

Japan is the second largest economy after US in terms of Gross Domestic Production (GDP). However the two economies are different in various aspects, example Japans economic development is attributed to the high technological innovations. The South Africa however is a less developed country compared to Japan.