...Chapter 16 1. Evolving into Multinationalism. As a firm evolves from purely domestic into a true multinational enterprise, it must consider 1) its competitive advantages, 2) its production location, 3) the type of control it wants to have over any foreign operations, and 4) how much monetary capital to invest abroad. Explain how each of these considerations is important to the success of foreign operations. If a firm lacks sufficient competitive advantage to compete effectively in its home market, it is unlikely to have sufficient advantages of any type to be successful in a foreign market. t. Foreign operations must be located where market imperfections are such that the firm can take advantage of its competitive advantages to the degree necessary to earn a risk-adjusted rate of return above the firm’s cost of capital. The firm must decide upon the degree of control it will need over the foreign operation, recognizing that greater control usually involves both greater risk and a greater investment.The firm must decide if the benefits of greater investment (presumably greater profits, plus possibly acquiring market share or forestalling competitors from gaining a greater market share) are worth the differing amounts of monetary capital needed. 2. Market Imperfections. MNEs strive to take advantage of market imperfections in national markets for products, factors of production, and financial assets. Large international firms are better able to exploit such imperfections. What...
Words: 1173 - Pages: 5
...PROJECT FINANCING AND INTERNATIONAL MARKETS ASSIGNMENT 1 GROUP 1 PRESENTATION A TERM PAPER WRITTEN BY: 1. Joash Gombe 2. Carren Oyolla L50/70100/2013 3. Julius Owade 4. Lillian Dullo 5. Diana osuri 6. Willy Mugenzi Lecturer: Dr. Nyonje UNIT: LDP 602: PROJECT FINANCING Assignment submitted in partial fulfillment for the award of Masters Degree in Project Planning and Management of the University of Nairobi 2014 ABSTRACT This document examines the financial markets that multinational corporations, government agencies and banks use in conducting the business. It combines a solid foundation of theory with a state of art analysis of today international markets. The international market include the market for foreign exchange, the euro currency and related money markets, the euro bond and global equity markets, the commodity markets and the markets for forward contracts, options, swaps and other derivatives. In recent years profound changes have swept the markets and institutions of finance. In key ways the institutions that in car lies decades dominated global finance commercial banks and supranational organization like the IMF have been displayed by direct private finance. The IMF originally designed to resurrects the worlds monetary system following the chaos of the World War II has become a leader to less developed countries...
Words: 5395 - Pages: 22
...Module 4: ASSESSING THE SOCIAL-CULTURAL ENVIRONMENT Demographic Trends Costa Rica’s demographic data is very encouraging. Costa Rica has not suffered any major domestic political violence since 1948. There are no indigenous or external movements likely to produce political or social instability. This stunning nation is known worldwide for its inspiring motto: “Pura Vida!”, which means ‘pure life’ in Spanish. Everything about its relaxed lifestyle and vibrant landscape is a testament to this pleasant slogan. The rich territory distances over 19,560 square miles yet it accounts for a total of 6 percent of the planets total biodiversity. According to the last census of Costa Rica (2011) the population of Costa Rica was 4,301,712 with a male population of 2,106,188 and a female population of 2,195,524. The age percentages of the nation are as follows: Under the age of 5 8.8%, age 5 to 12 15%, age 13 to 1710%, age 18 to 24 13.6%, age 25 to 59 44.3%, and age 60 and older8.4%. According to the UNDP (United Nations Development Program), in 2010 the life expectancy at birth for Costa Ricans was 79.3 years. The Costa Rican labor force is relatively well educated compared to other countries in Central America. The rapid growth of Costa Rica’s service and tourism sectors has stimulated demand for English-language speakers and prompted the Costa Rican Government to declare English language and computer literacy to be a national priority at all levels of education. (StateDepartment...
Words: 1284 - Pages: 6
...opic: Some economists support higher minimum wage whereas some don't. What is your opinion? Minimum wage should be outlawed for the disruption it creates in the economy because it makes jobs just as valuable to workers depending on wage, hinders certain industry from growing as fast as others, and removes the honesty of wage based on performance. For non-related industries such as gardening and law enforcement, workers get paid at a minimum wage price where the duty in work is vastly different. Law enforcement or private security can be far more dangerous yet wages are set at a minimum where the law dictates how low an employee can get. This creates a problem because workers may want to choose to garden at a minimum wage because it is safer and more tranquil that earning a minimum wage on the force. Furthermore, operations would suffer due to the lack of demand from laborers. Especially for law enforcement agencies, cost of operation or production is much higher than that of gardening and frequently requires more workers. If more workers get paid a minimum price the company suffers by spending more on expenses or may choose not to employ. Thus creating a scenario where labor can either swing for the more difficult yet essential job or hobby oriented gardening for the same wage. This minimum wage limit makes it harder for companies to pick out spectacular candidates for a job because it creates work based on the stratification of profit or advancements. That way laborers...
Words: 290 - Pages: 2
...1. Evaluate the risk strategies of Phibro, Mobil, and Conoco (Are their strategies appropriate? Why? What would you suggest to them?) Phibro’s strategy when entering the Russian oil market was to try to take advantage of being the first mover. As a new smaller firm within a large oligopolistic structure of the oil industry Phibro’s move was risky but potentially necessary to in order to move itself to a better position within the market. By moving into Russia first through a joint venture with VNG Phibro hoped to gain access to a significant source of scarce input crude petroleum One of the main reason moving into new market is that a company has a specific expertise to share to allow it to gain a competitive advantage. While Phibro certainly had a capital to contribute to any venture its expertise in the oil industry was limited and it has been in operation only for less than ten years before it took on the White Night Project. This lack of expertise showed itself in the mistakes it made while entering the Russian market. First the company had trusted the Russian estimates of the available oil rather doing its own research. This was a costly mistake when it turned out that the estimates of available crude oil was too generous. Second the company entered into a contract that left it dependant of on its foreign partner. Phibro promised to provide capital to find the needed technology and services, while VNG would provide the feels and the infrastructure. This left Phibro with...
Words: 1592 - Pages: 7
...The Company also had approximately $118 million accrued as of December 31, 2011, for an insurance contingency as a member of Oil Insurance Limited (OIL). This insurance co-op insures specific property, pollution liability, and other catastrophic risks of the Company. As part of its membership, the Company is contractually committed to pay a withdrawal premium if we elect to withdraw from OIL. Apache does not anticipate withdrawal from the insurance pool; however, the potential withdrawal premium is calculated annually based on past losses and the nature of our asset base. Insurance Program We maintain insurance coverage that includes coverage for physical damage to our assets, third party liability, workers’ compensation, employers’ liability, sudden pollution, and other risks. Our insurance coverage includes deductibles that must be met prior to recovery. Additionally, our insurance is subject to exclusions and limitations, and there is no assurance that such coverage will adequately protect us against liability from all potential consequences and damages. Our current insurance policies covering physical damage to our assets provide $1 billion in coverage per occurrence. These policies also provide sudden pollution coverage. Coverage for damage to our U.S. Gulf of Mexico assets specifically resulting from a named windstorm, however, is subject to a maximum of $250 million per named windstorm, which includes a self-insured retention of 40 percent of the losses above a $100...
Words: 408 - Pages: 2
...nkjTurkish news nowadays carry vivid images which have become terrifyingly commonplace: the surface of the sea littered with dead sheep; a landfill explosion leading to a number of deaths; vendors offering radiation-contaminated tea for half-price; a little girl's death resulting from her fall through an open sewage manhole in her schoolyard; radioactive waste sold to unsuspecting scrap dealers; a twenty-year-old tanker breaking into pieces, spilling hundreds of tons of crude oil into the ocean and killing sea life all around. The frequency with which these environmental disasters fill Turkish news broadcasts -- along with the obvious insensitivity of the authorities towards both environment and health issues -- prompted me to learn about ways to prevent these types of disasters. At the age of fifteen, I decided to focus my studies on environmental sciences in order to equip myself with the technical tools I would need to make a real contribution. After earning a master's degree in environmental sciences, I completed a professional international management certificate program in order to gain a management perspective of the field. I then realized that, in order to effectively combine my technical knowledge and management skills, I needed to accumulate real-world experience. Specifically, working at a large company would allow me to develop insight into various industries, as well as an overarching vision of the international business arena. I have now worked for nearly...
Words: 862 - Pages: 4
...Saudi Arabia is a kingdom that located in the Middle East region. It is the leader country in OPIC and that show’s how large is the Saudi’s economic power. The average of the Saudis are educated. From the beginning history of this kingdom, the government showed the importance of education for both men and women. Decades ago, the Saudi government started a project to give scholarships to the students who wants to complete their education abroad. The Saudi culture is very sensitive issue. Most of the Saudis are conservatives. A lot of changes happened in the Saudi’s economy, education, and cultures after five years of king Abdullah being in charge. The Saudi’s economy had major changes in the last five years. Before, the Saudi’s economy was relying on the oil business. Today, the Saudi economic policy has been changed a lot. King Abdullah established one of the four economic cities. The economic cities are a government development plan for the future. The goal of this plan is to diversify their economy away from oil, by generating foreign interest and bringing big corporations to these economic cities. The Saudi education has been changed to the better during the last decades and it at its best these days. King Abdullah is very interested in the education field. He established international universities for men and women. These universities afford full scholarships to Saudis and international students. Good example of these universities is King Abdullah of Science and Technology...
Words: 597 - Pages: 3
...Turkish news nowadays carry vivid images which have become terrifyingly commonplace: the surface of the sea littered with dead sheep; a landfill explosion leading to a number of deaths; vendors offering radiation-contaminated tea for half-price; a little girl's death resulting from her fall through an open sewage manhole in her schoolyard; radioactive waste sold to unsuspecting scrap dealers; a twenty-year-old tanker breaking into pieces, spilling hundreds of tons of crude oil into the ocean and killing sea life all around. The frequency with which these environmental disasters fill Turkish news broadcasts -- along with the obvious insensitivity of the authorities towards both environment and health issues -- prompted me to learn about ways to prevent these types of disasters. At the age of fifteen, I decided to focus my studies on environmental sciences in order to equip myself with the technical tools I would need to make a real contribution. After earning a master's degree in environmental sciences, I completed a professional international management certificate program in order to gain a management perspective of the field. I then realized that, in order to effectively combine my technical knowledge and management skills, I needed to accumulate real-world experience. Specifically, working at a large company would allow me to develop insight into various industries, as well as an overarching vision of the international business arena. I have now worked for nearly two...
Words: 862 - Pages: 4
...Turkish news nowadays carry vivid images which have become terrifyingly commonplace: the surface of the sea littered with dead sheep; a landfill explosion leading to a number of deaths; vendors offering radiation-contaminated tea for half-price; a little girl's death resulting from her fall through an open sewage manhole in her schoolyard; radioactive waste sold to unsuspecting scrap dealers; a twenty-year-old tanker breaking into pieces, spilling hundreds of tons of crude oil into the ocean and killing sea life all around. The frequency with which these environmental disasters fill Turkish news broadcasts -- along with the obvious insensitivity of the authorities towards both environment and health issues -- prompted me to learn about ways to prevent these types of disasters. At the age of fifteen, I decided to focus my studies on environmental sciences in order to equip myself with the technical tools I would need to make a real contribution. After earning a master's degree in environmental sciences, I completed a professional international management certificate program in order to gain a management perspective of the field. I then realized that, in order to effectively combine my technical knowledge and management skills, I needed to accumulate real-world experience. Specifically, working at a large company would allow me to develop insight into various industries, as well as an overarching vision of the international business arena. I have now worked for nearly two...
Words: 862 - Pages: 4
...07-044 Rev. December 15, 2009 This case was prepared by lecturer M. Jonathan Lehrich and MIT Sloan students Paul John Paredes and Ramesh Ravikumar (MBA Class of 2005). Copyright © 2007, M. Jonathan Lehrich, Paul John Paredes and Ra mesh Ravikumar. This work is licensed under the Creative Commons Attribution-Noncommercial-No De rivative Works 3.0 Unported License. To view a copy of this license visit http://creativecommons.org /licenses/by-nc-nd/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA. Compsis at a Crossroads M. Jonathan Lehrich, Paul John Paredes, Ramesh Ravikumar 2004 had not been a good year for Compsis. Founded in 1989 in the Brazilian industrial city of São José dos Campos, Compsis had grown steadily and su ccessfully. In its largest service line, systems integration for electronic toll collection (ETC), th e company had gained the dominant share of the Brazilian market and had even managed projects in Australia and India. Compsis had developed strong relationships with the Brazilian government a nd toll road operators, as well as an international reputation among industry competitors for quality and technological expertise. By 2003, the company’s founders could take pride in reach ing a height of 165 employees and US$4.2 million (R$11.1 million) in revenue. In 2004, however, it appeared that Compsis’s success might be in jeopardy. Revenue fell to US$3.3 million, primarily...
Words: 969 - Pages: 4
...CASE 4-1 TALK TO ME INC.: Expansion in Russian Telecommunications Market GLOBAL OPERATIONS AND LOGISTICS•TEXT AND CASES Philippe-Pierre Dornier, Ricardo Ernst, Michel Fender, Panos Kouvelis PROFESSOR: PAPADOPOULOS T. CHRISSOLEON COURSE: CASE STUDIES – SPECIAL TOPICS IN SERVICE SECTOR 2014 DERVENI VASILEIA (100) 1/5/2014 CONTENTS: INTRODUCTION 3 THE PROPOSAL 3 TALK TO ME INC. 3 THE RUSSIAN ENVIRONMENT 4 DOUBTS ABOUT THE PROPOSAL 5 DECISION ANALYSIS 5 What really happened 6 REFERENCES: 6 INTRODUCTION The present case study refers to Talk to Me Inc., a company specialized in telecommunications that examined back in 1995 whether or not to expand in the Russian market. The company’s background and action so far, as well as the environment of Russia played a catalytic role in making the decision of expanding in the soviet country. THE PROPOSAL The case begins with the proposal of the Russian Ministry of Communications to Talk to me Inc., known as the 50/50 project. The purpose of this project is to develop an entirely new telecommunications network in Russia and got its name from its goals. In particular, the 50/50 project’s aims were to connect 50 Russian cities, to establish 50 long-distance transit switches and 50 thousand kilometers of digital lines. The 50% of equipment required for the project would be manufactured in Russia and the 50% of the funding...
Words: 1091 - Pages: 5
...CHAPTER 6 BUSINESS-GOVERNMENT TRADE RELATIONS LEARNING OBJECTIVES: 1. Describe the political, economic, and cultural motives behind governmental intervention in trade. 2. List and explain the methods governments use to promote international trade. 3. List and explain the methods governments use to restrict international trade. 4. Discuss the importance of the World Trade Organization in promoting free trade. CHAPTER OUTLINE: Introduction Why Do Governments Intervene in Trade? Political Motives Protect Jobs Preserve National Security National Security and Imports National Security and Exports Respond To “Unfair” Trade Gain Influence Economic Motives Protect Infant Industries Pursue Strategic Trade Policy Benefits of Strategic Trade Policy Drawbacks of Strategic Trade Policy Cultural Motives Cultural Influence of the United States Methods of Promoting Trade Subsidies Subsidies in Media and Entertainment Drawbacks of Subsidies Export Financing Foreign Trade Zones Special Government Agencies Methods of Restricting Trade Tariffs Protect Domestic Producers Generate Revenue Quotas Reason for Import Quotas Reasons for Export Quotas Voluntary Export Restraints Tariff-Quotas Embargoes Local Content Requirements Administrative Delays Currency Controls Global Trading System General Agreement on Tariffs and Trade (GATT) Uruguay Round of Negotiations Agreement on Services Agreement...
Words: 2900 - Pages: 12
...CHAPTER 6 BUSINESS-GOVERNMENT TRADE RELATIONS LEARNING OBJECTIVES: 1. Describe the political, economic, and cultural motives behind governmental intervention in trade. 2. List and explain the methods governments use to promote international trade. 3. List and explain the methods governments use to restrict international trade. 4. Discuss the importance of the World Trade Organization in promoting free trade. CHAPTER OUTLINE: Introduction Why Do Governments Intervene in Trade? Political Motives Protect Jobs Preserve National Security National Security and Imports National Security and Exports Respond To “Unfair” Trade Gain Influence Economic Motives Protect Infant Industries Pursue Strategic Trade Policy Benefits of Strategic Trade Policy Drawbacks of Strategic Trade Policy Cultural Motives Cultural Influence of the United States Methods of Promoting Trade Subsidies Subsidies in Media and Entertainment Drawbacks of Subsidies Export Financing Foreign Trade Zones Special Government Agencies Methods of Restricting Trade Tariffs Protect Domestic Producers Generate Revenue Quotas Reason for Import Quotas Reasons for Export Quotas Voluntary Export Restraints Tariff-Quotas Embargoes Local Content Requirements Administrative Delays Currency Controls Global Trading System 1 General Agreement on Tariffs and Trade (GATT) Uruguay Round of Negotiations Agreement on Services Agreement on Intellectual Property Agreement on Agricultural...
Words: 2958 - Pages: 12
...Doing Business in Thailand: 2012 Country Commercial Guide for U.S. Companies INTERNATIONAL COPYRIGHT, U.S. & FOREIGN COMMERCIAL SERVICE AND U.S. DEPARTMENT OF STATE, 2010. ALL RIGHTS RESERVED OUTSIDE OF THE UNITED STATES. • • • • • • • • • • Chapter 1: Doing Business In Thailand Chapter 2: Political and Economic Environment Chapter 3: Selling U.S. Products and Services Chapter 4: Leading Sectors for U.S. Export and Investment Chapter 5: Trade Regulations, Customs and Standards Chapter 6: Investment Climate Chapter 7: Trade and Project Financing Chapter 8: Business Travel Chapter 9: Contacts, Market Research and Trade Events Chapter 10: Guide to Our Services 1 Return to table of contents Chapter 1: Doing Business In Thailand • • • • Market Overview Market Challenges Market Opportunities Market Entry Strategy Market Overview • Return to top Thailand is the 27th largest export destination for the United States. Two-way trade in 2011 was about $35.75 billion, with $24.8 billion in Thai exports to the U.S. and $10.9 billion in U.S. exports to Thailand. The figures represent an increase of 12.9 percent in the value of trade between the two countries. U.S. exports to Thailand increased by 21.7 percent, while US imports from Thailand increased by about 9.4 percent for the same period in 2010. In Asia, Thailand ranks as the United States’ 10th largest export destination after China, Japan, South Korea, Hong Kong, Taiwan, India, Hong Kong, Singapore and Malaysia. The Thai...
Words: 42883 - Pages: 172
