Documenti di Didattica
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COVERAGE
Increasing interdependence in the Global Economy Trends in Intl. Trade & Cross-Border Financial Flows Recent Developments in Global Financial Markets Challenges of Intl. Financial
INTERNATIONAL BUSINESS
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Encompasses our daily lives Beverages from USA Tea from Sri Lanka Mobile instrument from China TV from Japan
INTERNATIONAL BUSINESS
An English princess with an Egyptian boyfriend crashes in a French tunnel driving a German car with a Dutch engine driven by a Belgian who was high on Scottish whiskey followed closely by Italian Paparazzi on Japanese motorcycles treated by an American doctor using Brazilian medicines!
INTERNATIONAL BUSINESS
And this is sent to you by a Filipino using Bill Gates' technology which is American. And you are probably reading this on one of the IBM clones use Taiwanese-made chips, and Korean made monitors, assembled by Bangladeshi workers in a Singapore plant, transported by lorries driven by Pakistanis, hijacked by Indonesians5
INTERNATIONAL BUSINESS
Focus
globe To seize global business opportunities and address threats In order to buy or sell goods or services worldwide
around 1870 and ended with World War I driven by industrial revolution in UK / Germany / USA Trade barriers set and trade suffered Breakdown of Gold standard & the need for international cooperation in the post-World war II
1947, the Generalised Agreement on Trade & Tariffs ( GATT ) came into being In 1995, GATT was replaced by WTO Efforts of IMF, World Bank & WTO alongwith efforts of individual countries led to globalisation as closed economies needed to open up
WTO - Implications
WTO
set up to strengthen World economy, leading to more trade, investment , employment and income growth In the wake of WTO, tariffs were reduced from over 30 40 % to below 5 % Regional integrations play a significant role NAFTA, ASEAN,SAARC Decline in Investment barriers to promote and protect investment
Recent developments
Growth
in FDI Investment in manufacturing and in markets FDI Inflows increased from USD 564 Bn in 1980 to USD 2.8 Tn in 2008 82% came from advanced countries Emerging economies received higher FDI USA has been the largest provider of FDI BRICS now in focus Internet and Worldwide web Online commerce Reduced travel time Technological developments Internet, Worldwide web, Online commerce
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no. of companies that did business in more than one country grew Of the 500 top MNCs 139 were from USA, 71 from Japan and 46 from China
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of information needed Timely information required Business size needs to be large Markets need to be segmented
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opportunities preferences
aspects Namaaz (Middle east) / Family activities (Fiji Islands) Employees Business Environment
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Practices Govt.Policies Monetary System National Security issues FATF / OFAC Language Nationalism and Business Policy
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I Domestic company II International company domestic prdn. Off-loaded in fgn. Mkts. Also branch in fgn. Country Stage III Branches work like domestic branch in each country (polycentric). These are multi-domestic companies (Philips of Netherlands) Stage IV Global company has global strategy. Produces in home / single country and markets globally ( Dr. Reddys Labs ) Stage V Transnational company 18 produces, markets, invests and
global enterprise linking global resources to global markets at profit Geocentric orientation Think globally and Act locally Assets across the World Knowledge and experience in various markets is shared Information relating to various markets is collected and scanned
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is GLOBAL Geographic scope offers opportunities Operating style key operations globalised Adaptation to markets Extension of markets no change in pdt. HRM Policies Top key positions for home nationals. Best practices
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Domestic Business
Scope Operating
Approach Ethnocentric National style Domestic activities National / Tariffs / Forex rates / Exim procedures of other countries No direct impact / HR / Mk. & Customers - Local
International Business
Environment Quotas
Culture
Approach Polycentric Scope International Operating style Global Environment Global Quotas / Tariffs / Forex rates / Exim procedures of other countries Direct impact Culture / HR / Mk. & Customers Global
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Same domestic product is exported ( early stage). Polycentric Fgn. Subsidiary. Strategy of home country and key personnel from home country. Regiocentric Subsidiary exports to countries in region. Strategy of Region
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Cos. Franchising arrangements with fgn. Cos. Contract manufacturing Turnkey projects Management contracts Direct Investment Joint Venture Megers and Acquisitions
with fgn.
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Rate of Return Expansion / Excess production beyond demand leading to Export Competition in Home country Political stability Availability of Technology and Personnel Transportation costs Proximity to Raw-material source Cost of Human Resources Liberalisation Market-share growth Higher rate of Economic development Tariffs and Inport quota
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factors Forex risks Entry requirements and barriers Tariffs / Quotas / Trade barriers Corruption / Piracy / Bureaucracy Quality maintenance Higher costs
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living standards Increasing socio-economic welfare Wider market Large-scale economies ability to expand Reduced impact of economic conditions / political and commercial risks Growth of World economy
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capacity Economic portfolio allocation Taxation benefits Cost-efficiency of products / services Innovation / Product development Sourcing at lower costs material, people and technology
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YOU
THANK
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