...Assignment 2 Lukoil: Trade Strategy at a Privatized Exporter Word Count: 1946 Introduction Over the past decade, Russia has witnessed year after year of significant growth in terms of its GDP. The vast majority of this growth can be attributed to Russia’s most valuable natural resource, Crude Oil. Overall, the oil industry accounts for a staggering 25% of Russia’s total GDP, as well as totaling 40% of all exports leaving its borders (Poussenkova, 2010). Lukoil, Russia’s largest oil company came about in 1991, when the then state owned oil monopoly was dismantled (Firlej, 2009). Today Lukoil accounts for roughly 19% of all oil production in Russia with profits reaching $108 Billion in 2008. Despite tremendous success in recent times for Russian oil exports, the state now looks to offset the risks associated with both heavily fluctuating oil prices as well as its enormous dependence upon oil exports for the well being of the nation. Because of this, companies such as Lukoil are now engaging in foreign investment to reduce the effects of fluctuating oil prices, political uncertainty as well as other risks related with their position (Firlej, 2009). This paper will discuss various aspects of Russia’s position as an oil exporter as well as various risks that may be faced in the near future. Theories of Trade When talking about Russia’s global position as an oil exporter, it is best to use various trade theories to help explain the situation. Firstly, it must...
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...o What theories of trade help to explain Russia’s position as an oil exporter? Which ones do not, and why? Russian is an exporter of oil based on various trade theory. First of all, Russia's oil exports as a competitive advantage compared to foreign counterparts. Since the oil industry must follow the laws of supply and demand, Russia is now in high positions. Russia has the largest oil reserves in the world along with Saudi Arabia, they continue to rotate the position of the largest oil producing country in the world. Russia is third country give oil and gas in Europe and now beginning to increase exports to the East Asian markets are hungry for energy. Russian oil companies have become major competitors worldwide. Thus, the percentage factor theory is applied. Russia has the greatest potential to increase the market share of the suppliers. In 2000, Russia exported 87 percent of its production outside the former Soviet Union. Moreover, Russia increased its oil exports in 2001, while OPEC cut output three times. If Russia succeeds in attracting foreign investment and joint ventures, the oil industry will have a competitive advantage compared to the state-owned company in the country does not allow foreign investors, such as Saudi Arabia and Kuwait. Interference theory of mercantilism theory is not applicable country size. Moreover, the product life cycle theory does not apply because the oil is not an appropriate type of products for this model. o How do global political...
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...BUSINESS ENVIRONEMENT Course Work: PESTLE ANALYSIS "Vesan" Ltd. was established in 1999[1] with scope of business activity "internal and foreign trade, agency and marketing deals with intellectual property and real estate re barter and other specific foreign operations, transportation, forwarding, warehousing, commission and advertising business, commercial representation and intermediation of Bulgarian and foreign natural and legal persons performing any services in marketing and information services, and any other activity that is not prohibited by law." The company is registered in the Commercial Register to Register Agency with unique identification number: 831714531 (Bulgaria, 2012). The Vesan’s headquarter and management address is located in Sofia, 127 "Maria Louisa" blvd.[2] (Vesan, 2012) The company has specialized in the supply of heating fuel for homes, offices and factories, but also in the supply of automotive fuel. To perform high quality work, the company has six tank cars with a capacity of 6,000 to 13,000 RT with which makes the delivery of fuel even in inaccessible places. Furthermore, in the territory of Kazichene office there is a gas station that serves the tank company and external customers as well. The mission of "Vesan" Ltd. is associated with satisfying the needs of consumers, by delivering fuels at the right place at the right time. Commercial organization contributes to the evolution...
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...sector of the Caspian Sea (Exhibit 1 identifies the AIOC members). As of March 1999, AIOC had completed the $1.9 billion Early Oil Project, which was producing 100,000 barrels of crude oil per day (bpd). The next three stages, known as the Full Field Development Project, were expected to cost an additional $8 to $10 billion and would bring total production to 800,000 bpd by 2005.1 Before the merger, BP and Amoco held the two largest interests in AIOC (17% each), yet they had chosen different strategies for funding their shares of the Early Oil Project. Whereas BP had used general corporate funds, Amoco was one of five AIOC partners that had raised $400 million of project finance with assistance from two multilateral agencies. Now, as a merged entity, the Finance Group had to reassess the firm’s financial strategy for the Early Oil Project and determine the best way to finance the Full Field Development Project. While it was possible to continue with a dual financing strategy, such an approach could complicate BP Amoco’s management of the asset as well as impair its effectiveness as the de facto leader of the joint venture. Caspian Oil and the AIOC The Caspian Basin (see the map in Exhibit 2) had been the site of significant oil production since the middle of the nineteenth century. Although the fields had, at one time, provided as much as 70% of the former...
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...Westminster International College Module Title: Research Skills Programme: BABS Semester: Three Academic Year Period: June 2012 –September 2012 Lecturer: Dr. Kui Juan Tiang Date Given and Available on the Student Portal: 6 July 2012 Date of Presentation: Week Beginning 6 August 2012 Date of Completion and Submission: 15 August 2012 Submission Method: Online via Turn It In with one hard copy to the Examinations Department Assessment Type: An individual presentation and type-written assignment Student: Aliaskar Batyrbek Student ID: NE/WICKL/UWIC/BABS/1011/0117 Assignment Topic: An investigation study of development of oil and gas industry in Kazakhstan Table of Contents 2 Introduction 4 2.1 Country Profile 4 2.2 History of industry 4 3 Research Objectives 5 4 Literature Review 6 4.1 Geographic Factor 6 4.1.1 Major Oilfields 8 4.1.2 Export Operating Pipelines 9 4.2 Government Policies 11 4.3 Financial Factor and R&D Factor 12 4.4 Market Prospects 14 4.4.1 Market players 14 4.4.2 Production 15 4.4.3 Consumption 16 5 Research Methodology 18 6 Time Scale / Gantt Chart 19 7 References 20 Figure 1 4 Figure 2 (KMG, 2012) 5 Figure 3 (BP, 2012) 5 Figure 4 (European Dialogue, 2012) 6 Figure 5 (BP, 2012) 6 Figure 6 (CIA, 2012) 8 Figure 7 (Centre for Global Energy Studies, 2012) 9 Figure 8 (Centre for Global Energy Studies, 2012) 9 Figure 9 (The Agency of Statistics of...
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...7. What are the benefits and problems that MNCs face? 11 8. What are the Russian companies that achieve the multinational status? 13 Conclusion 14 Bibliography 14 Appendix 15 Preface We would like to consider the most interesting topic concerning the multinational corporations. If we called it like that, it means that company made a great success in the market, it operate in several foreign countries. In this mini-course work we will investigate more detailed the structure and strategies of MNCs. In the first part we will look through the history of MNCs. The history, in general, is to be considered as an essential part of every project in order everyone may compare the development of the particular sphere. Next part will show us the statistical data of MNCs, where we will recognize all the most reputable companies from the different industries, such as BMW, Nike, Lego, etc. We cannot leave a side the point of entry into the new market. There it will be explained the strategies of MNCs, such as mergering, joint venture and sequential market entries. Also we will consider investing into the particular companies, weather it is risky or not and the motives of foreign direct investment. Another important point is the comparison of the Transnational Corporations and Multinational Corporations. Of course if we live in Russian, it would be great to present the native companies that achieved status of MNC. The following data will be presented in the convenient tables. ...
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...elfth Edition INTERNATIONAL BUSINESS Environments and Operations John D. Daniels University of Miami Lee H. Radebaugh Brigham Young University Daniel P. Sullivan University of Delaware Pearson Education International Contents Preface 29 About the Authors • PART ONE 39 BACKGROUND FOR INTERNATIONAL BUSINESS 44 1 Globalization and International Business 45 49 44 CASE: The Global Playground Introduction 48 W h a t Is International Business7. The Forces Driving Globalization 50 Factors in Increased Globalization 51 What's Wrong with Globalization? 56 Threats to National Sovereignty 56 Economic Growth and Environmental Stress 57 Growing Income Inequality 57 s | Point ^J3ffi^S^^3 ' Offshoring Good Strategy? 58 Why Companies Engage in InternationaLBusiness Expanding Sales 60 , Acquiring Resources 60 Minimizing Risk 60 60 Modes of Operations in International Business Merchandise Exports and Imports 62 Service Exports and Imports 62 Investments 63 Types of International Organizations 63 Why International Business Differs from Domestic Business 64 Physical and Social Factors 65 The Competitive Environment 67 Looking to the Future: 61 Three Ways of Looking at Globalization 68 C A S E : Carnival Cruise Lines: Exploiting a Sea of Global Opportunity 69 74 Summary Key Terms 75 Endnotes 75 An Atlas 78 Map Index 86 Contents • 2 PART TWO COMPARATIVE ENVIRONMENTAL FRAMEWORKS 90 91 90 The Cultural Environments...
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...Emerging Markets Perspectives - CEO Insights Emerging Markets Perspectives - CEO Insights 1 Convergence & Differentiation What is success in a connected world?* Methodology This report was developed to provide a unique perspective from which to view the successes of companies based in emerging markets. While there are many reports providing valuable insights on how multinationals can expand into emerging markets, very few take a systematic approach towards looking at how emerging-market companies have not only fended off developed-world multinationals, but also found their own ways to expand into foreign markets. In addition to drawing on the insights of PricewaterhouseCoopers partners and associates from every market, we relied on two additional sources: 1. The 11th Annual PwC Global CEO Survey: The authoritative analysis of CEO views on business opportunities and risks of operating in an increasingly connected world. PricewaterhouseCoopers has published the survey for more than a decade, reaching out to more than 1,100 chief executive officers worldwide. The 11th Annual Global CEO Survey was launched in January 2008 at the World Economic Forum’s annual meeting in Davos. The survey data were re-analysed for this report at the country level as well as by contrasting insights from developed versus emerging markets. For the purposes of this report, we define “developed nations” to include 19 economies, including the United States and Canada, 15 in Western Europe, Japan...
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...HBR.ORG The Globe F A Cautionary Tale for Emerging Market Giants PHOTOGRAPHY: GETTY IMAGES How leadership failures in corporate Japan knocked its companies off the world stage by J. Stewart Black and Allen J. Morrison ifteen years ago, Japanese companies accounted for 141 of the companies and 35.2% of the revenues of Fortune’s then brand-new Global 500 list. By 2000 their share of revenues had fallen to 20.8%, and by last year it had shrunk to 11.2%, with only 68 Japanese companies making the list. During the same period, U.S. firms’ portion of Global 500 revenues, which was 28.4% in 1995, grew slightly, to 30%. Firms from the European Union and Switzerland, meanwhile, increased their portion from 31% to 36%. Much of Japan’s loss has been a gain for firms from emerging markets. Since 1995 companies from the BRIC nations (Brazil, Russia, India, and China) have seen their combined share of Global 500 revenues leap from 0.9% to 10.4%. But will those countries lose their edge in the years ahead, as Japan did? Or will they find ways to remain globally competitive and protect their share—as the U.S. and Europe have done? To answer those questions, we first need to understand why Japan was unable to continue the meteoric rise it saw in the 1970s and 1980s, because the new generation of emerging-country multinationals bears a disturbing resemblance to corporate Japan in the 1990s. Over the past quarter century, we have tracked the rise and fall of Japanese business, and...
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...Scanning (PESTEL analyses, Scenarios) - Industry or Sector Analysis (5 forces, industry/product life cycle) - Competitors scanning (Strategic Group Map, CPM) - The Organization responses (EFEM) 4 2 Layers of the business environment 5 Key Aspects of PESTEL Analysis • Not just a list of influences • Need to understand key drivers of change • Drivers of change have differential impact on industries, markets, and organisations • Focus is on future impact of environmental factors • Combined effect of some of the factors likely to be most important 6 3 Macroenvironment – PESTEL (1) 7 Microenvironment – PEST(EL) Political Economic • Government stability (+) • Taxation policy (+) • Foreign trade regulations (+) • Social welfare policies (-) • Business cycles (-) • GNP trends (-) • Interest rates (--) • Inflation (+) • Unemployment (-) 8 4 Microenvironment – PEST(EL) Socio-cultural Technological • Population demographics (-) • Income distribution (+) • Social mobility (-) • Lifestyle changes (+) • Attitudes to work and leisure (+) • Consumerism (+) • Levels of education (-) • Government spending on research (-) • Government and industry focus on technological effort (-) • New...
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...The Theoretical Value of Studying Indian Multinationals Ravi Ramamurti The rise of new multinationals in countries like India provides an opportunity to revisit and carefully construct theories of how firms internationalize—a topic on which extant theory is weak. Indian firms are “infant MNEs,” unlike Western firms that are “mature MNEs.” Indian firms are also internationalizing in a very different global context, and can do so on the basis of different competitive advantages, than MNEs that came before. Finally, research on Indian MNEs can help identify generic strategies for internationalization, examples of which are provided in the article. By pursuing the lines of inquiry proposed, research on Indian MNEs can contribute not just to better local practice but also to broader theory building about early-stage internationalization. Ravi Ramamurti is CBA Distinguished Professor of International Business and Director, Centre for Emerging Markets, at Northeastern University, USA. E- mail r.ramamurti@neu.edu. This essay draws heavily on the author’s two papers (“Why Study Emerging-market Multinationals?” and “What Have We Learned about Emerging –market Multinationals?”) in Ravi Ramamurti & Jitendra V. Singh (eds.) (2009), Emerging Multinationals in Emerging Markets, Cambridge, UK: Cambridge University Press. Research on Internationalization of Indian Firms Research on India’s emerging multinational enterprises (MNEs) may be intrinsically rewarding for India specialists, but...
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...Managing structure, profitability and growth NICK ANTILL and ROBERT ARNOTT SP 15 Oxford Institute for Energy Studies 2002 The contents of this paper are the authors’ sole responsibility. They do not necessarily represent the views of the Oxford Institute for Energy Studies or any of its Members. Copyright © 2003 Oxford Institute for Energy Studies (Registered Charity, No. 286084) All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior permission of the Oxford Institute for Energy Studies. This publication is sold subject to the condition that it shall not, by way of trade or otherwise, be lent, resold, hired out, or otherwise circulated without the publisher’s consent in any form of binding or cover other than that in which it is published and without similar conditions including this condition being imposed on the subsequent purchaser. ISBN 1-901795-27-6 Cover designed by Clare Hofmann Typeset by Philip Armstrong, Sheffield Printed by Biddles, Guildford CONTENTS List of Figures Acknowledgements 1 2 INTRODUCTION INDUSTRY STRUCTURE 2.1 An Examination of Corporate Structure 2.2 The Urge to Integrate 2.3 A Question of Balance 2.4 Just how Operationally Integrated? 2.5 Are there Tangible Benefits to Operational Integration? 2.6 Important Transition to Financial Vertical Integration 2.7 Integration or Atomisation...
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...STATEMENT 11 1.4 RESEARCH OBJECTIVES 11 1.5 SIGNIFICANCE OF THE STUDY 11 2.0 RESEARCH METHODOLOGY 12 2.1 DATA COLLECTION METHOD 12 3.0 CHAPTER THREE: LITERATURE REVIEW 13 4.0 CHAPTER FOUR: FINDINGS 15 4.1 INTERNAL ANALYSIS 15 4.1.1 STRENGTH 15 4.1.2 WEAKNESS 15 4.1.3 OPPORTUNITY 15 4.1.4 THREAT 15 4.2 HOST COUNTRY BACKGROUND / MACRO ENVIRONMENT ANALYSIS 16 4.2.1 POLITICAL 16 4.2.4 TECHNOLOGICAL 18 4.2.5 ENVIRONMENTAL 20 4.2.6 LEGAL 21 4.3 MODE OF ENTRY 23 4.4 EXTERNAL ANALYSIS 23 4.4.1 RIVALRY AMONG EXISTING FIRMS 23 4.4.2 THREATS OF NEW ENTRANTS 24 4.4.3 THREATS OF SUBSTITUTE PRODUCT/SERVICE 24 4.4.4 BARGAINING POWER OF SUPPLIER 25 4.4.5 BARGAINING POWER OF BUYER 25 4.5 MARKET PENETRATION STRATEGIES 25 4.5.1 PRODUCT 25 4.5.2 PLACE (DISTRIBUTION) 27 4.5.3 PRICE 28 4.5.4 PROMOTION 29 5.0 CHAPTER FIVE: CONCLUSION 30 5.1 CONCLUSION 30 5.2 LIMITATION OF STUDY 32 REFERENCES 33 ACKNOWLEDGMENT Assalamualaikum and a very great thankful dedicated to almighty Allah S.W.T for giving us this wonderful opportunity where we are able to portray our capability in completing this international business report. Special thanks is also dedicated to our beloved lecturer, Sir Zaid Mat Yusop for giving us this great task and helping us in developing our skill in various angel such as communication skill, team work, general knowledge about agriculture so on and so forth. We would also send our appreciation to our family for their...
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...FOREIGN DIRECT INVESTMENT IN KAZAKHSTAN By Toxeitov Nurlan THESIS Submitted to KDI School of Public Policy and Management in partial fulfillment of the requirements for the degree of MASTER OF PUBLIC POLICY 2004 FOREIGN DIRECT INVESTMENT IN KAZAKHSTAN By Toxeitov Nurlan THESIS Submitted to KDI School of Public Policy and Management in partial fulfillment of the requirements for the degree of MASTER OF PUBLIC POLICY 2004 Professor Tony Michell 2 TABLE OF CONTENTS LIST OF TABLES .......................................................................................................(iii) LIST OF ABBREVIATIONS ......................................................................................(v) INTRODUCTION ........................................................................................................(vi) CHAPTER I. INVESTMENT AND THEIR PLACE IN ECONOMIC SYSTEM §1 §2 Definition of investments and their classification ................................................4 Foreign direct investments as the catalyst of economic growth (on an example of the various countries) ..............................................................7 §3 The international investment activity and her institutes .....................................16 CHAPTER II. INVESTMENT CLIMATE IN KAZAKHSTAN §1 §2 §3 §4 Appeal of economy of Kazakhstan to foreign investors .....................................22 Fixed capital investment in Kazakhstan by region ...................
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...agreement on TNK- BP’s right of first refusal in relation to potential future oil and gas projects offered to BP or AAR in Russia and Ukraine. This agreement was subsequently used by AAR to stop the BP-Rosneft deal in international courts. Unfortunately, this was not the first time that BP had been unable to change the way it conducted its business in Russia. The first example occurred in 2007-8 when BP was reported to be keen on having Gazprom as a partner instead of AAR. This move would have transformed the TNK-BP joint venture into Gazprom-BP. This did not transpire. Second, in the spring-summer 2008, there was a turbulent ‘misunderstanding’ between BP and AAR, over the corporate governance and future strategy of their joint venture. This led to the removal of Robert Dudley from the helm 1 Shamil Yenikeyeff is a Research Fellow at the Oxford Institute for Energy Studies and a Senior Associate Member at the Russian and Eurasian Studies Centre, St Antony’s College, University of Oxford. Dr Yenikeyeff is the author of...
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