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LECTURE 1:Strategy in Global Context (1)
Coverage today
A. Theories of…
LECTURE 1:Strategy in Global Context (1)
Coverage today
A. Theories of globalization and the modern business landscape
B. International trade: markets, institutions, practices
C. Establishing the context for global business management
D. The role of Information Systems and Digital Technologies
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B. International trade: markets, institutions, practices
1. Benefits of International Trade
- International Trade: Purchase, sale, or exchange of goods and services across national borders
- Benefits of international trade:
-greater choice of goods and services
-important engine for job creation in many countries
2. Volume of International Trade
The value and volume of international trade continues to increase
3. International Trade Patterns
There has been a persistent pattern of merchandise trade among nations
4. How has FDI changed over time?
- In the 1960s, US firms accounted for about two-thirds of worldwide FDI flows
- today, the US accounts for less than one-fifth of worldwide FDI flows
- other developed countries have followed a similar pattern
- in contrast, the share of FDI accounted for by developing countries has risen
- developing countries, especially China, have also become popular destinations for FDI
5. The changing world order
- Many former communist nations in Europe and Asia are now committed to democratic politics and free market economies
-so, there are new opportunities for international businesses
-but, there are signs of growing unrest and totalitarian tendencies in some countries like Russia
- China and Latin America are also moving toward greater free market reforms
-between 1983 and 2008, FDI in China increased from less than $2 billion to $90 billion annually
-but China also has many new strong companies that could threaten Western firms
6. How will the global economy of 2020 look?
- the world is moving toward a more global economic system...
- but globalisation is not inventible
-there are signs of a retreat from liberal economic ideology in Russia; how will China proceed? India? Brazil? 2017-18- The new protectionism?
-multinationals becoming less globalised...
- globalisation brings risks
-the financial crisis that swept through South East Asia in the late 1990s
-the recent financial crisis that started in the US in 2008, and moved around the world...2018- a next crisis?
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