国际商务的环境Chapter-5-Economic-environment-facing-international-business-PPT课件

1、Chapter 5Economic Environment for International Business Learning objectivesHaving read this chapter you should be able to:Be aware of the effect of world economic crisis on international businessIdentify the trends in world trade Explore the measurement of international tradelearn the strategies fo

2、r successfully developing an overseas marketWarm-up: The ongoing financial crisisStarting from the bankruptcy of Leman Brothers in America on 5th September.The direct inducement: the subprime mortgage crisis taking place at Wall Street since August.The subprime mortgageIt is a type of mortgage that

3、is normally made out to borrowers with lower credit ratings. Lending institutions often charge interest on subprime mortgages at a rate that is higher than a conventional level in order to compensate themselves for carrying more risk.American housing bubblePrior to 2019 the soaring housing price Rem

4、ortgaging real estate, purchased on loan, transformed into a credit cardThe real estate price has dramatically declined ever since 2019, resulting in the immediate rupture of chain of payment on loanThe bursting of American housing bubble spread to the whole domestic financial industry, then worldwi

5、de.The ongoing financial crisis“fake prosperity”American financial system: Omnipotent (全能的, 无所不能的)As to the current worldwide recession American government has to bear most of the responsibility in the aspects of indulging loose supervision and turning a blind eye to the ineligible loan. American co

6、nsumption culture crisisText: The International Economic EnvironmentThe trend towards a global business environmentFirms reasons for going globalMeasuring international tradeMarket entry strategiesIntroduction Many business organizations recognize that their growth can continue only if they exploit

7、overseas markets. However, entering overseas markets can be extremely risky. Therefore, a good understanding of the international economic environment can be of good help. E.g. McDonalds initial failure in the UK market in the 1970ernational economic environmentsTrade patterns and strategies th

8、roughout the world change in response to changes in the international economic environments. E.g. during the first years of the twenty-first century, the rising GDP per capita of China has resulted in Chinese consumers purchasing increasing numbers of overseas holidays. Measuring international trade

9、balance of payment: The difference between what a country receives from overseas and the amount it spends overseas.(国际收支平衡) current account (经常帐户) transactions； the purchase and sale of goods and services current accountcapital account (资本帐户) transactions； the acquisition and disposal of assets and

10、liabilities abroad Current account & capital account The current account is generally further divided into: A visible trade balance, including transactions in manufactured goods, raw materials and fuel products; An invisible trade balance, made up of servicesThe capital account records outward and i

11、nward flows of capital for investment purposes. It includes payments made for long-term investment in tangible assets (有形资产) . and intangible assets (无形资产), and short-term movements of money between traders in the money markets. Market entry strategiesA companys market entry strategy should aim to b

12、alance between a potential opportunity and a risk to an organization.The least risky method of developing a foreign market is to supply that market from a domestic base. Market entry risk reduction strategies also have a time dimension. E.g. McDonalds and Burger King in the turbulent business enviro

13、nment of Eastern Europe in the late 1980s, A range of entry possibilities Exporting: where economies of scale in production are high and transport costs are low Direct investment in a foreign subsidiary: maximum control, but exposure to a high level of risk Global e-commerce: the Internet has offere

14、d new opportunities Licensing/franchising: following a product formulation closely and to maintaining consistent standards of quality and grand image. Joint ventures: a partnership between a domestic company and a foreign company or government Joint ventures the initial capital requirement threshold

15、 is high, resulting in a high level of riskoverseas governments restrict the rights of foreign companies to set up business on their own account, making a partnership with a local company possibly involving a minority shareholding the only means of entering the marketthere may be significant barrier

16、s to entry which a company already based in the foreign market could help to overcome taxation of company profits may favor a joint venture rather than owning an overseas subsidiary outright.Key terms culture convergence 文化趋同markets segments 市场细分GDP per capita 人均国内生产总值Balance of Payment 国际收支平衡表visib

17、le trade 有形贸易invisible trade 无形贸易current account 经常帐户capital account 资本帐户joint venture 合资企业market entry strategy 市场进入战略Summary of key pointsThere are various reasons for the trend of globalization of the business environment.“Pull” factors for companies going global are to seek growth and gain acces

18、s to new markets, to achieve economies of scale.“Push” factors: the nature of a firms product requires the firm to go global, some firms whose domestic market is too small to allow economies of scaleA chief method of measuring international trade is one countrys balance of payment, consisting of cur

19、rent account and capital account.When entering a foreign market, companies choose various strategies to reduce market entry risk.Comprehension questionsSummarize the “pull” factors and “push” factors of firms reason for going global.What are the key methods of measuring international trade?What are

20、the main components of the BOP (balance of payment)?Illustrate the main market entry strategies.Give at least three reasons for the globalization of business environment.Apply your understandingWhat the difference between the merchandise trade balance and the current account balance?Why must a count

21、rys balance of payments always be balanced in theory?Find a multinational company having business with China and identify its market entry strategies.Essay questions Suppose the well-known UK hotel group Le Ritz is to develop a new location in India, what cultural differences might be encountered an

22、d cause problems?Case study: Chinese Firms Incentives for Foreign AcquisitionsCase-related questions:1. What do you think of the authors argument? 2. How do you evaluate the opportunities and risks in doing business with China?3. Whats your suggestion for foreign companies doing business with China?

23、 Point-CounterpointHelping Developing Nations: Aid or Trade?Point Aid is better than trade.Many experts believe that the development of the less developed countries is dependent on aid. Aids are mainly used to finance infrastructure projects and alleviate human suffering directly. Aid also may be pr

24、eferable to trade because it creates fewer political problems in the donors country Counterpoint Trade is preferable to aid.Trade provides jobs for residents of less developed countries. The wages generates demand for local businesses and employment opportunities for local residents.More important,

25、as domestic firms expand their exports, their managers and employees learn new skills and techniques for producing and marketing goods. Failures of aid programs Web alert/World Trade Organization, provides information on international trade developments, statistics, WTO documents and policies./Inter

26、national Monetary Fund, which contains IMF news, publications and international economic information./charvey/Country_risk/couindex.htmCountry Risk Analysis, which is a rich source of historical data about world trading markets. It discusses economic, financial and political events which impact on international trade./std/serint.htmOrganization for Economic Co-operation and Development (OECD): International