International business

Chapter1

Foreign firm International investment:

i) Foreign direct investments- owned a company

ii) Portfolio investments- just invest to get dividend

Problem:

1) legal system

2) culture

3)availability of resources

4) currency conversion

Activities of international business

1)Exporting& importing

2)International investment

3)Licensing, franchising, management contract

Objective of multinational corporations

~ engage in FDI

~ own and control foreign assets

~ buy, create and sell goods & services in multiple coutries.
Globalization- decline of trade barrier
~ end of world war II
~ technological change(telecommunication,internet >> lower infor cost,lower transportaton)
Global institution occur:
~manage,regulate and police the global market place
~promote lower trade barrier
Eg: GATT general agreement on tariffs and trade,WTO World trade organization, UN united nations, IMF international monetary fund
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Chapter3
Legal environment
~Domestic follow home country's law.
~International businesses follow home and host country's law.
Type of law:
i)Common law (country under british before) eg, malaysia ,singapore
ii)Civil law eg,Italy, japan thailand
iii)Religious law eg, saudi arabia,Iran (no appeal process)
iv)Bureaucratic law (country under communist before) eg, china, south korea