1、1Part One:Environmental FoundationChapter One:Worldwide Developments2Objectives of the ChapterREVIEW current trends in international investment and tradeEXAMINE the present economic status in the major regions of the global communityANALYZE some of the major developments and issues in various region
2、s of the world3IntroductionInternational Management The process of applying management concepts and techniques in a multinational environment4Multinational Corporation(MNC)Operates in more than one country Sells its products in international markets Managers and owners are of different nationalities
3、 Must learn to work effectively with people from different countries5Small and medium-sized businesses are being affected by the trend toward internationalization6Increasing InternationalizationRegional Developments North American Free Trade Agreement(NAFTA)A free trade agreement between the U.S.,Ca
4、nada,and Mexico which has in essence removed all barriers to trade May expand to include Latin American countries7 European Union(EU)Consists of 27(2010)countries Most trade barriers have been removed Euro is the common currency Pacific Rim Japan and China are the dominant economies Association of S
5、outheast Asian Nations(ASEAN)8International Investment and Trade Foreign direct investment(FDI)The amount invested in another country Approximately 80%of all international investments come from developed countries9 International trade has increased substantially over the last two decades Percentage
6、of world trade accounted for by the three major trading blocs has remained fairly consistentGroups share of imports and exports remains in the range of 55-59 percent10-MNCs buy domestic companies rather than trying to export products to that country11RECENT TRENDS IN FOREIGN DIRECT INVESTMENT IN OEC
7、D COUNTRIES.http:/www.oecd.org/dataoecd/13/30/35439819.pdf.2007-9-9Table 1-112Table 1-2 Top 10 trading Partners of the U.S.:1999 Importing U.S.Exporting U.S.Rank Country/District Exports*RankCountry/District Imports*1Canada166,600.0 1Canada 198,711.1 2Mexico 86,908.9 2Japan130,863.9 3Japan 57,465.7
8、3Mexico 109,720.5 4U.K.38,407.1 4China 81,788.2 5Germany 26,800.2 5Germany 55,228.4 6South Korea 22,958.4 6U.K.39,237.2 7Netherlands 19,436.6 7Taiwan 35,204.4 8Taiwan 19,131.4 8South Korea 31,178.6 9France 18,877.4 9France 26,708.6 10Singapore 16,247.3 10Italy 22,356.5*in millions of dollars 13Table
9、 1-3 Top Ten Countries/District with which the U.S.Trades:For the month of June 2007 The values given are for Imports and Exports added together.These Countries/District represent 66.85%of U.S.Imports,and 64.64%of U.S.Exports in goods.Source:http:/www.census.gov/foreign-trade/top/dst/current/balance
10、.html.2007-9-914Country/District NameTotal in Billions of U.S.$Year To Date Total in Billions of U.S.$Canada49.49277.07China32.96178.59Mexico29.62167.92Japan17.29103.08Federal Republic of Germany11.9569.74United Kingdom9.2853.65Korea,South7.1441.37France5.9633.91Taiwan5.6830.95Netherlands4.2724.9315
11、Table 1-4 Top Ten Countries/District with which the U.S.Trades:For the month of June 2010 The values given are for Imports and Exports added together.These Countries/District represent 66.75%of U.S.Imports,and 62.08%of U.S.Exports in goods.Source:http:/www.census.gov/foreign-trade/top/dst/current/ba
12、lance.html.2010-8-1616Country/District NameTotal in Billions of U.S.$Year To Date Total in Billions of U.S.$Canada46.98260.74China39.58201.86Mexico33.70187.65Japan15.2785.13Federal Republic of Germany11.2961.53United Kingdom8.7748.14Korea,South7.7241.58Taiwan5.3628.46Brazil5.2427.77France5.2231.6217
13、Economic Status and Issues of the Major RegionsNorth America NAFTA has resulted in:Elimination of tariffs as well as import and export quotas Opening of government procurement markets to companies in partner countries18 Increased opportunity to make investments in partner countries Increased ease of
14、 travel between partner countries Removal of restrictions on agricultural products,auto parts,and energy goods19 United States U.S.MNCs have holdings throughout the world Foreign MNCs find U.S.to be a lucrative market20North America(cont.)Canada U.S.s largest trading partner Legal and business envir
15、onments similar to those of the U.S.Target of increased international investment21 Mexico Economic fortunes have varied in the recent past Mexican firms expanding worldwide operations22Economic Status and Issues of the Major Regions(cont.)South America Countries have experienced difficult economic p
16、roblems23 BrazilAttracted substantial foreign investmentEconomic future still uncertain ChileEconomic success story in South AmericaFuture still uncertain24 Mercosur and Andean Common Market promote economic and social integration and cooperation Countries increasingly looking to trade with the U.S.
17、25Economic Status and Issues of the Major Regions(cont.)Europe Privatization of traditionally nationalized industries EU intended eliminate all trade barriers among member countries26 EU-based firms“plan globally,act locally”To gain a foothold in the EU,foreign MNCs have:created acquisitions and all
18、iancesbegun co-operative research and development programs27 European Research Cooperation AgencyEU agency that funds projects in a number of fields to make Europe more productive and competitive in the world market Future challenge is the absorption of formerly communist Eastern neighbors28Europe(c
19、ont.)Central and Eastern Europe Collapse of the Soviet Union in 1991Glasnost(openness)Perestroika(economic and political restructuring)29 RussiaUndergone economic reformMany attempts to stimulate the economyGreater privatization requiredCriminal activity increasing30 Czech Republic,Hungary,and Polan
20、dFormer communist countries that have become most visible in international arena Some former communist countries are struggling31Economic Status and Issues of the Major Regions(cont.)Asia Japan Economic success in the 1970s and 1980s attributed to:Cultural values32Ministry of International Trade and
21、 IndustryGovernment agency that identifies and ranks national commercial pursuitsGuides the distribution of national resources to meet these goals33KeiretsusOrganizational arrangement in which a large group of vertically integrated companies are bound together by cross-ownership,interlocking directo
22、rates,and social ties provide goods and services34 Severe recession during the past ten years Target for foreign investment35Asia(cont.)China Large reported annual growth in GDP Attracts substantial foreign investment MNCs find it difficult to do business in China36 The Four Tigers South KoreaChaebo
23、lsLarge,family-held conglomerates that have considerable political and economic powerHit hardest by Southeast Asia economic crisis37 The Four Tigers(cont.)Hong KongHeadquarters for successful multinational operations in Asia38 SingaporeLeader and financial center of Southeast AsiaOne of the most com
24、petitive nations TaiwanEconomy dominated by technologically sophisticated industries39 Southeast Asian Countries Baby Tigers lack the economic prowess of the Four Tigers40Table 1-5 Worlds Most Competitive Nations/District:2000 RankUnited States 1Singapore2Finland3Netherlands4Switzerland5Luxembourg6I
25、reland7Germany8Sweden 9Iceland 10Canada 11Denmark 12Australia 13Hong Kong 14United Kingdom 1541Country Rankings 2009-20101.Switzerland 9.Canada2.US 10.Netherlands3.Singapore 11.Hong Kong SAR4.Sweden 12.Taiwan,China5.Denmark 13.United Kingdom 6.Finland 14.Norway7.Germany 15.Australia 8.Japan 29.China
26、 Source:http:/en.wikipedia.org/wiki/Global_Competitiveness_Report.2010-8-17Table 1-6 Worlds Most Competitive Nations/Districts:2009-2010 Rank42Characteristics of Less Developed CountriesLowGDPHighinternationaldebtSlow(ornegative)GDPgrowth percapitaLargepopulationHighunemploymentInexpensiveunskilled
27、orsemi-skilledlaborLessDevelopedCountries43Economic Status and Issues of the Major Regions(cont.)Less Developed Countries(LDCs)India Steady economic growth in the past few years Attractive to investment by MNCs44 Middle East and Central Asia Oil reserves are an attractive economic asset Balance geopolitical,religious forces with economic viability Organization of Petroleum Exporting Countries(OPEC)45 Africa International trade not a major source of income Sub-Saharan nations troubled by tribal warfare,disease,poverty,and starvation
