...The Impact of multinational companies A case study of the energy industry in Saudi Arabia Abstract Contents 1. Introduction 4 1.1. Rationale of the Research 6 1.2. Aims & Objectives of the Research 7 1.3. Key Research Questions 7 2. Literature Review 9 3. Research Methodology 13 4. Key Findings & Discussion 13 5. Conclusion 16 6. References 16 7. Appendices 16 1. Introduction In this era of globalization, there has been a fundamental change in the way international business is being done. Due to the ease of communication and advances in the sophisticated communication systems more and more companies are becoming global and expanding their operations and creating production facilities away from their home countries. This trend has given rise to today’s Multinational Corporations (MNCs) whose role in the international scene is increasing rapidly. With increased international development and cooperation, the MNCs have been able to create such a network that their budgets, organizational structure and influence on the world trade stage rivals many nations [ (UN Conference Proceedings, 2006) ]. With their immense economic power and strong political connections and the fact that globalization is seen as a “Business driving phenomenon”, MNCs are in a strong position to influence the economies of the countries...
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...between Saudi Arabia and China, which centre on the crude oil and petrochemicals industries China mainly exports to Saudi Arabia textile, clothing, light industry products, food like grain etc. It imports from Saudi Arabia crude oil, chemical fertilizer and petro-chemical raw materials the import trends between china and Saudi Arabia in the recent years (2012,2013,2014) is while there was a decline in the imports of goods from Saudi Arabia in 012 and 013, the was a general rise in 2014 placing Saudi Arabia as the 10th largest import market for china (2.5% of china’s imports) Exports trend: increased exports from 2012 to 2014, in 2012 at $18.5, in 2023 at $18.7 and at $20.6 in 2014 placing Saudi Arabia as one of the largest export markets for china. In the recent years, the bilateral trade volume of sino-saudi has achieved steady growth since the establishment of diplomatic relations while the trade balance is reducing in comparision to the China views Saudi Arabia with great importance for several reasons: (a) Saudi’s history as a reliable partner with all of its customers (b) saudi is the world’s largest petroleum exporter with capacity of 12 million barrels per day; (c) vast amount of oil which China desires, 17 percent of the world’s proven oil reserves are located in the Saudi Arabia (d) Saudi Arabia has the largest economy among the Arab countries and - (e) China recognizes that Saudi Arabia, the leading...
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...again.” King Faisal (1904-1975) Introduction Energy, especially crude oil is one of the most valuable commodities in today’s international trade, an indispensable source primarily for transportation and industrial production. This makes oil prices one of the most important elements of today’s economy. In that sense, the Kingdom of Saudi Arabia is on the centre of world economy because of her rich reserves also because the Kingdom has the lowest production cost in the world. Saudi production capacity and the Kingdom’s political stability are key elements for the international oil prices and consequently the world economy. Saudi Arabia is essential to the international oil market also, because she is the swing producer, meaning that she has the ability to affect the price by changing the supply and the other producers’ behaviours. Saudi Arabia is given an example par excellence for the leader in an oligopolistic market by Bhattacharya as the country holds an important market share, Saudi Aramco figures state that Saudi Arabia has 260 billion of oil, which accounts near one fourth of the known reserves, also high flexibility in capacity utilization, low financing requirement thanks to the low cost and it is negligible sensitivity to the changes in the market. Rising world oil prices and Saudi Arabia's capability to quickly respond to the market demand by increasing its output levels in times of the crises. Most recently, Saudi cover supply shortages, as regime change in Libya...
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...Econ201 Macro-economy Spring 2013 Wesam Almadani LAG140 Table of Content Overall state of Economy in Saudi Arabia Demographic profile of Saudi Arabia GDP in Saudi Arabia CPI and Inflation Rate in Saudi Arabia Unemployment Rate in Saudi Arabia Economic problems in Saudi Arabia Economy in Saudi Arabia Saudi Arabia is the largest Arabian Country which is located in southwest Asia. It clenches the largest free market economy in the Middle East and North Africa. The geographic setting of Saudi Arabia provides an easy entrée to export the markets of Europe, Asia, and Africa. Saudi Arabia is an oil-based economy with a robust government control over the main economic activities; it approximately holds 17% of the worlds established petroleum assets. Saudi Arabia grades the largest exporter of petroleum, and plays a primary role in OPEC. The petroleum sector alone interprets for roughly 45% of GDP, 80% of budget revenues, and 90% of export earnings. The following shows the demographic profile of Saudi Arabia: Population | 26,939,583 includes 5,576,076 non-nationals | Dependency Ratio | total dependency ratio: 46.9 % youth dependency ratio: 42.6 % elderly dependency ratio: 4.2 % potential support ratio: 23.6 | Population Growth Rate | 1.51% | Net Migration Rate | -0.62 migrant(s) / 1,000 population | Urbanization | urban population: 82.3% of total population (2011) rate of urbanization: 2.38% annual rate of change...
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...Executive Summary Islam is one of the most widely practiced religions in the world and can be found in many different regions throughout the globe. With such a large, widespread following these populations cannot be avoided by marketers. Firms selling product globally, especially in Muslim-majority countries, need to be aware of the norms and regulations in these nations and adapt their advertisements accordingly. This can pose a real challenge, even for large multinationals, as we will see throughout the remainder of the report. Additionally, regulations found in one Islamic nation can vary greatly in comparison to the advertising styles in another. Each country is different and although many nations are Muslim-majority, such as Saudi Arabia, Iran, and Indonesia, they all have varying practices and rules and cannot be treated as one in regards to advertising. A firm must tailor their marketing style to each individual nation while respecting and acknowledging their religious practices. As far as recommendations for marketers, they will need to be tailored to each country individually, but in general it is important to embrace the Islamic religion and integrate the brand into Muslims’ everyday life while taking care to respect their beliefs and practices. Islamic nations are said to be “the next frontier” of advertising, so it is essential that large firms and their agencies take note of these norms and regulations and use research and knowledge to their advantage when...
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...Instruction on the Group Project Principles of Management Each project group is expected to collectively write a case report that focuses on an ethical issue faced by a real-life organization, a specific industry, or a business profession. Following is a suggested outline for the case written by your group: I) Background Information (e.g., corporate history) II) The Central Ethical Dilemma(s) III) Alternative Ways to Deal With the Ethical Dilemma(s) IV) Possible Consequences and Implications of Alternative Solutions V) Ethical Theories That Are Applicable to This Case VI) Key Questions for Case Study When writing this case report, you are encouraged to gather as much relevant information as possible from various online and offline data sources. However, all the information used in your case analysis must be properly cited in the main body of your report, including the author name(s) and publishing date/year, if available, and the detailed citations must be included in the References section. Your case report will be graded on the following criteria: 1) Proper application of ethical theories 2) Quality of writing (readability, originality, grammatical correctness, etc.) 3) Breadth of information utilized (at least 20 different articles or books need be cited and actually used in writing this case) 4) Demonstrated critical thinking skills 5) Robust logical reasoning 6) Comprehensive data analysis (i.e. taking into...
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...Executive Summary Islam is one of the most widely practiced religions in the world and can be found in many different regions throughout the globe. With such a large, widespread following these populations cannot be avoided by marketers. Firms selling product globally, especially in Muslim-majority countries, need to be aware of the norms and regulations in these nations and adapt their advertisements accordingly. This can pose a real challenge, even for large multinationals, as we will see throughout the remainder of the report. Additionally, regulations found in one Islamic nation can vary greatly in comparison to the advertising styles in another. Each country is different and although many nations are Muslim-majority, such as Saudi Arabia, Iran, and Indonesia, they all have varying practices and rules and cannot be treated as one in regards to advertising. A firm must tailor their marketing style to each individual nation while respecting and acknowledging their religious practices. As far as recommendations for marketers, they will need to be tailored to each country individually, but in general it is important to embrace the Islamic religion and integrate the brand into Muslims’ everyday life while taking care to respect their beliefs and practices. Islamic nations are said to be “the next frontier” of advertising, so it is essential that large firms and their agencies take note of these norms and regulations and use research and knowledge to their advantage when...
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...Post published a story about an oil conflict rising between Saudi Arabia and Yemen. The Egyptian newspaper, al-Masry al-Yom, quoted in the story, refers to the conflict as the “Yemen - Saudi Arabia new Oil conflict” (Yemen Post) implying preexisting disputes between the two countries regarding the extraction of natural resources. Until 2012, Yemen's officials embraced its country's world-wide image as the poorest country in the Arabian Peninsula with depleted natural resources. However, starting with the resignation of then president, Ali Abdullah Saleh, the discovery of large petrol deposits in earth pockets worth up to several billion dollars were made public. Yemen's close neighbor, Saudi Arabia, the superpower of oil exports in the region, is becoming more uneasy, especially after rough estimates predicting that soon Yemen could be “home to much of the world's oil and gas resources, maybe just as much as Saudi Arabia itself”(Yemen Post). Experts from Yemen Post are also speculating that the newly discovered fortune could be the answer to Yemen's current unemployment rate, poverty, illiteracy and other problems. With vast natural resources, arable lands, key geographical location and military potential, Yemen could soon challenge the superpower of Saudi Arabia in the region. The disputes over borders between the two countries dating back to the Saudi-Yemen war in 1934 could soon resurface especially with Saudi Arabia resuming its construction of the fence along the Yemen border...
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...Saudi Arabia Its officially known as the Kingdom of Saudi Arabia, is an Arab state in western Asia Saudi Arabia is the worlds largest oil producer and largest exporter and controls the worlds largest hydrocarbon reserves. Saudi Arabia is a member of Organization of the petroleum exporting countries(OPEC). Saudi Arabia's command economy is petroleum based roughly 75% of budget revenues and 90% of export earnings come from the oil industry. GDP-$648.971billion Trade relations between China and Saudi Arabia China's main exports to Saudi Arabia: automobiles, electronic goods , industrial machinery etc. China main imports from Saudi Arabia: crude oil, liquefied petroleum gas and primary plastics. In 2014 ,Saudi was the 20th and 10th export and import market respectively for China (0.9% of China exports and 2.5% of China imports)..the bilateral trade was $69.1bn and trade balance -$27.9bn Bilateral trade is the exchange of goods and services between countries. Trade balance is the difference between the monetary value of exports and imports of output in an economy over a period of time. China has also undertaken several energy exploration agreement with the Saudi Arabia's government winning the right to explore e.g. in Saudi Arabia's al-khali basin Saudi Arabia agreed to help China develop strategic petroleum reserves and to modernize downstream refining capacity e.g. deal to construct a refinery for natural gas in Fujian province Saudi Arabia is involved in...
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...Historical, Current state of the issue and Emergence of Saudi Arabia as free market Historical Saudi Arabia is a total monarchy ruled by King Abdallah bin Abdul Aziz Al Saud. Saudi Arabia has appeared to be satisfied with advance in economic. As a primary for oil producer and exporter, Saudi Arabia controls the whole Organization of Petroleum Exporting Countries. Saudi Arabia’s free market economy has incredible changes in a relatively short term of time. I t has grown from agricultural base community into the regional and global economic power with a modern infrastructure. Petroleum is a fundamental part of the Saudi Arabia’s economy comprising 45 percent of the country’s GDP. Saudi Arabia is the world’s largest producer and exporter of oil, accounting for 20 percent of the oil reserves. GDP in 2010 was estimated at USD622BN ( USD 24,200 per capita). GDP growth in 2010 was 3.7%. Petroleum is an integral part of the Saudi economy comprising 45 percent of the country’s GDP. Saudi Arabia is the world’s largest producer and exporter of oil, accounting for 20 percent of the world’s oil reserves. GDP in 2010 was estimated at USD622 BN (USD 24,200 per capita). GDP growth in 2010 was 3.7% Saudi Arabia was first graded in the 1996 Index, and its economic freedom score has declined since then by 6.1 points. Rating gains in trade freedom, investment freedom, and the management of government spending have been overwhelmed by substantial double-digit declines in property rights, freedom...
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...Economic development of south arabia Name: Institution: Economic development of south Arabia South Arabia is one of the developing nation,it largely depends on petroleum income for its budget revenues.It is one of the largest oil producing countries in the world and petroleum income accounts for more than 50% of its budget revenues and 90% of earning from export. since the discovery of oil in 1930s the economy of south arabia has grown tremendously to a high level(Oxford,2012).Its economy has since shifted from subsistence farming to the service and oil industries. South arabia economy is ready for economic take off,with huge investment by government on infrastructure and other social amenities, high and stable income from oil and increase export of non-hydrocarbon (IMF,2012).The economist have projected this years economic growth to be 7% citing reasons such as increase oil revenues and massive government investment(Oxford,2012).In the recent past the government has rolled out plans of investing back Increased revenues from oil export into economy by announcing new development programmes like housing units,infrastructure and other economic stimuli programmes. South Arabias increase in economic growth is also being contributed to by government plans to diversify the economy, the government has invested heavily in industrial and agricultural sector, while also encouraging both local and foreign investors to invest in the economy(Worldbank,2012). The government...
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...Country Briefings: Azerbaijan and Saudi Arabia Marvin Labre Sarah Garstecki Kalle Stenbaek Trenton Norton Table of Contents Economic Environment………………………………………………………………………....3 Azerbaijan…………………………………………………………………………….....3 Saudi Arabia………………………………………………………………………….....5 Political and Regulatory Environment...………………………………………………………..6 Azerbaijan………………………………………………………………………………6 Saudi Arabia………………………………………………………………………….....6 Cultural and Societal Framework………………………………………………………………7 Azerbaijan………………………………………………………………………………7 Saudi Arabia………………………………………………………………………….....9 Technological Environment…………………………………………………………………....10 Azerbaijan………………………………………………………………………………10 Saudi Arabia…………………………………………………………………………....10 Conclusion……………………………………………………………………………………...10 References………………………………………………………………………………………12 Economic Environment Azerbaijan Azerbaijan is a developing country that is heavily dependent on the exportation of gas and oil for its economic status. Other forms of sustainable economic consistency are from non-export organizations such as construction, banking, and real estate (CIA: World Factbook). Even in times of various economic trends, the country maintains its middle-class economy through the increase/decrease of the prices of their main resources. It’s from the positively consistent results that the government permits pervasive corruption and structural economic inefficiencies from these local companies to pose as an obstacle to their...
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...Analysis of Saudi Arabia History of Saudi Arabia Saudi Arabia is a member of the Gulf Cooperation Council (GCC) (Bowen, 2008; Fasano and Iqbal, 2003). The country traces its origin back to the early empires of the Arabian Peninsula, which is an ancient trade centre. At present, Saudi Arabia serves a key role in the Islamic world, as it is the birthplace of Islam and the place where Mecca and Medina are located. Thus, the country frequently receives Islamic visitors during the annual Islamic Haj, as it owns the holy city of Mecca. The modern Kingdom of Saudi was established by King Abdulaziz Al-Saud, in 1932, and since then, the Kingdom has grown from a desert nation to a recent, classy state and a chief player on the global stage. Since time immemorial, Saudi Arabia has been an essential stake of the Arab world. Its huge supplies of oil and close links to America guaranteed its place, since the times of the cold war till when a wave of turbulence bust in Tunisia, during the month of January 2011, and touched the entire region. Currently, the ruling family in Saudi is experiencing a different world, anxiously. Early this month, Saudi Arabia pronounced the demise of Prince Nayef bin, who was a dedicated minister in the war against Al Qaeda and who was ignorant to change of democracy. After a few days, Prince Salman replaced him as the Crown Prince. Salman had served as a governor of Riyadh for almost 50 years ahead of his endorsement to the ministerial seat. Saudi Arabia, as the...
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...The Saudi Arabian Oil Company (Saudi Aramco) is the world's leading oil producing and exporting company. It is a fully-integrated, global petroleum enterprise that manages the world's largest oil reserves – about 260 billion barrels – and also manages the world's fourth largest natural gas reserves. Saudi Aramco is a fully integrated global petroleum enterprise headquartered in Dhahran, Saudi Arabia, participating in exploration & producing, refining, distribution, shipping, and marketing. With around 54,000 employees globally, representing 56 nationalities, the company is 100% owned by Saudi Arabian Government. Saudi Aramco has affiliates, joint ventures and subsidiary offices in China, Egypt, Greece, Japan, Netherlands, Philippines, Republic of Korea, Singapore, United Arab Emirates and the United States.Saudi Petroleum Overseas, Ltd is based in London and provides marketing and ocean transport support services. A subsidiary of Saudi Aramco owns a fleet of oil tankers to transport crude oil to key customers. Saudi Aramco, through subsidiaries, also invests in refineries and distribution networks around the globe. In addition to its headquarters in Saudi Arabia's Eastern Province city of Dhahran, Saudi Aramco has affiliates, joint ventures and subsidiary offices in China, Egypt, Japan, the Netherlands, Philippines, Republic of Korea, Singapore, United Arab Emirates, United Kingdom and the United States. In 2008, Saudi Aramco is celebrating its 75th anniversary...
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...of six countries: UAE, Oman, Saudi Arabia, Kuwait, Bahrain and Qatar; have been mainly dependent on oil and petroleum trading. Although finance in the GCC has grown to be a vibrant industry, but the GCC financial markets remain small and behind their potential globally. Since the beginning of the last decade, the GCC tried changing the strategy and going more into the financial markets. In the past five years, this strategy went to partially fall apart. The global financial crisis affected the finance business dramatically and the Gulf region did not handle it that well. Although the global view to the GCC financing has not been positive, but the GCC has been working and trying with all their efforts to develop their market and move forward. Saudi Arabia Stock Exchange, Tadawul ( TASI ), came along in the mid 1930's but remained informal until the early 1980's when the government formed a regulated market for trading with the required systems and techniques. It lists 159 publicly traded companies ( as of September 2, 2012). There are 15 sectors in the Saudi market which are: Banks & Financial services, Petrochemical Industries, Cement, Retail, Energy & Utilities, Agriculture & Food Industries, Telecommunication & Information Technology, Insurance, Multi-Investment, Industrial Investment, Building & Construction, Real estate & Property Development, Transport, Media & Publishing and Hotel & Tourism. The highest ranking sector of the Saudi Arabia Stock Market is the Banking &...
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