We present results of a global 3D MHD simulation of the interaction of the solar wind with the very local interstellar medium (VLISM). Three different cases are studied: purely hydrodynamic, MHD without charge exchange and MHD with charge exchange with the VLISM neutrals. Latitudinal differences in the solar wind are included as well as the solar cycle dependence of the Interplanetary Magnetic field (IMF). The latitudinal variation in the solar wind causes the polar termination shock at a considerably larger distance than in the ecliptic at the same angle with respect to the VLISM direction. As expected, the presence of magnetic pressure in the VLISM moves the termination shock inward, as does the presence of charge exchange with the neutrals. ©1999 American Institute of Physics.