Freedom of contract principles are taken for granted by executives from high income countries. In a high-income country for a contract to be binding and enforceable, there must be an offer and acceptance, consideration, definiteness and lawful subject matter.
In lower-income developing countries, governments have occasionally interfered with commercial contracts. This occurs due to differences in political doctrines involving the role of the state and the role of private enterprise.
FREEDOM OF CONTRACT SHOULD NOT BE TAKEN FOR GRANTEDIn many developing and socialist countries the host government frequently becomes a third party in the contract negotiations. Indeed the concept of renegotiation of contracts is commonly presumed and applied automatically in many developing and socialist countries while this is unheard of in the high-income countries.
EXTRATERRITORIAL REACHThis is the condition where a nation imposes control on activities of its citizens and corporations that occur in another nation-state. Specifically an international enterprise must do business in a nation-state in compliance with in the home country and when such laws affect activities in the home country, the home country will have control over the noncompliance activities . This condition creates conflict between nations, especially in the areas of antitrust , securities regulations, product liability, tax collections and export controls.
After the end of cold war , it has changed the world economic atmosphere every where in the world .US leads countries are going to high to higher income possiblity , on the other hand ex- socialism countries are trying to get their lost positions.