An Overview of International Business
Learning objectives
- Discuss the meaning of international business
- Explain the importance of understanding international business
- Identify and describe the basic
forms of international business activities
- Discuss the causes of globalization
- Comprehend the growing role of emerging markets in the global economy
What is international business?
International business consist of business transactions between parties from more than one country.
Why study international business?
- Catching up with foreign assignment
- Compete successfully with peers and future
competitors
- Running your own SMEs
- Obtain cultural literacy
- Stay abreast of the latest business and tools
Why does company go global?
Leveraging core competency
Acquiring resources and supplies
Seeking new markets
Minimize risks ; and
Competing with rivals
Reasons for increased growth in globalization
Increase in and expansion of technology
Liberalization of cross-border trade and resource movements
Development of services supporting IB
Growing consumers pressures
Increased global competition
Changing global political situation
Expanded cross-national cooperation.
Contemporary causes of globalization
What is globalization?
Manifestation of globalization
Intensification of the role of international trade
Growing importance of FDI (Foreign Direct Investment)
Causes of globalization
Strategic imperatives
The environmental causes of globalization
Globalization emerging markets.
Contemporary causes of globalization
Contemporary causes of globalization:
Strategic imperatives:
Leveraging a firm’s core competencies
Acquiring resources at low cost
Expanding into new markets
Competing with industry rivals
Environmental causes:
Changes in the political environment
Reduction of trade and investment barriers
The collapse and policy changes undertaken by China and India
Changes in the technological environment
Advances in transportation
Improvements in information processing
Changes in communication technology
Globalization and Emerging Markets
Review questions:
What is IB? how does it differ from domestic business?
Why it is important for you to study IB?
What are the basic forms of IB activity?
How do merchandise exports and imports differ from service exports and
imports?
What is portfolio investment?
What are the basic reasons for the recent growth of international
business activity?
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