AB 42 INT

BY:Husny GIbreel Musa

1501183443

International business
 Chapter 1

Questions

1.1. Professional athlete A is a star, and professional athlete B is an average player. How
has the globalization of professional sports affected each of these both positively and
negatively?
All athletes playing abroad may generate interest in the native country of a player, owing
in part to the ability to watch games taking place anywhere in the world via live Web
stream or satellite TV. This provides not only team owners, league representatives, but
also players with an expanded audience exposure, expanded fan base, and additional
revenue opportunities. On the negative side the athletes and teams must be sensitive to
cultural differences in undertaking any international sporting effort. They need to
appreciate worldwide differences and understand how to interpret the same sport
differently from one country to the next. It can also be noted that the average players can
benefit by playing and presenting his skills to professional teams from foreign markets,
which can in turn potentially offer them a contract.
1.2. As you read the chapter, identify and show an example of each international mode
of operations that is illustrated in the globalization of professional sport?

In the opening case, using the NBA as an example, it is looking globally for talent and
additional markets for its product. This is similar to any manager in nearly any industry
who needs to identify where you can get the best input at the best price and where you
can best sell the product from those inputs.

1.3. What global factors have contributed to the growth of the transportation and
logistics industry? How have they contributed to this growth?
Two major factors that have contributed to the cruise industry's growth are the shift in the
competitive environment brought about by the advent of transoceanic airline service and
increased discretionary income. As demand for liner travel declined as a result of less
expensive and much faster air service development, shipping lines were forced to respond
to the new market conditions by developing middle-class sea travel, i.e., cruises.
Furthermore, all-inclusive prices, a wide range of on-board and on-shore offers and
additional safety and security measures provided by the cruise industry have been highly
attractive in view of recent political developments.

1-4. what steps has Dubai Ports World taken to benefit from global economic
changes?

1-5. what economic factors influence the success of the international transportation
and logistics industry?

1-6. how can logistics companies increase business with countries in Europe, Asia, or
Africa?

1-7. what threats exist for Dubai Ports World? How would you overcome these
threats?

1-8. Discuss some of the legal issues that have faced Dubai Ports World? How has
this affected their Operations in the United States and other places?
Chapter 3
 Chapter 5

Questions

5-1. Using the framework in Table 5.1, explain which of the theories relate to Costa Rican
trade policy during each of the four eras described in the case.?

a) -Late 1800-1960 liberal trade-minimal government interference in trade and investment.

b) -1960-1882 import substitution – local production of goods and service that may
otherwise be imported.
c) -1983-early 1990s liberation of imports, export promotion and incentives for most types
of foreign investments.
d) Early 1990s –present strategic trade policy- production of specific types of products and
openness to imports.

5-2. Map 5.1 shows that a bit over 50 percent of Costa Rican exports go to only three
countries. Which trade theories may help to explain this concentration and why?
In 2011, a bit more than 50% of Costa Rica’s exports went to only three countries: United States
(30.4%), Netherlands (10.9%), and China (11.3%) Costa Rica has been known principally as a
producer of bananas and coffee, which are still important exports. However, in recent time’s
electronics, pharmaceuticals, financial outsourcing, software development, and ecotourism have
become prime industries in their economy.

5-3. what theories of trade help explain Russia’s position as an oil exporter? Why? Which
ones don’t? Why not?

5-4. how do global political and economic conditions affect global oil markets and prices?

5-5. Discuss the following statement as it applies to Russia and LUKOIL: Regardless of the
advan? Tages a country may gain by trading, international trade will begin only if
companies within that Country have competitive advantages that enable them to be viable
traders and they must fore see profits in exporting and importing.

5-6. In LUKOIL’s situation, what is the relationship between factor mobility and exports?

5-7. why do you think LUKOIL’s first foreign direct investments were in countries nearby
to Russia (e.g. former Soviet republics and satellite countries)?
 Chapter 7

7-1.
why did the Europeans try to protect their auto industry from Japanese imports, and
do you think this was fair to European consumers?
Europeans tried to protect their market from Japanese imports due to a variety of factors
including the advantage of Japanese imports being affordable and the elements of versatility and
dynamism associated with Japanese products. Toyota had emerged as a formidable competitor
flooding European markets with cheaper imports compared to European highly priced cars like
Mercedes Benz and BMW. As such, the determining factor has been the affordability aspect
(Toyota European Drive, 2017). In Japan, Toyota enjoyed lower production costs because of the
country's unique economic advantages and favorable government policies. The country enjoys a
large and growing pool of skilled automobile engineers who provide the industry with low-cost
labor. Toyota is able to sell its products at significantly lower prices in this respect compared to
those from European countries. It was in recognition of such a fact that the Europeans sought to
limit the presence of Toyota imports on their market.

Secondly, Toyota’s design-led production played to the advantage of the company on the
European market. Unlike, their European competitors, Toyota had the capacity to manufacture a
wide range of cars that vary in terms of models and aesthetics’ . Such element of diversity posed a
threat on the European products because the European market consumers were warming up to
such advantages of diversity.
I believe the European countries were not fair to their consumers, who deserved the freedom of
choice according to their preferences. In the spirit of globalization and market economy
liberalization, the European countries should have opened up to Japanese car imports and found
alternative ways to shield their local manufacturers from the adverse effects of cheap Japanese
importations. Customers should be left to choose the products to suit their tastes. Market forces
should be left to controll the market in conventional economics. In this respect, it could be
argued that the primary factor should have been promoting the local production.

7-2. Toyota has established production facilities in Europe to service the European
markets. Has Hyundai, Kia, or Honda followed the same strategy? If so, in which countries
have they set up manufacturing, and are they the same ones where Toyota is
manufacturing?

One of Toyota’s international strategies has been the spread of its production presence in
different parts of the world in order to effectively serve its global niche. Europe is one of the
places where the company has performed remarkably well and set up its production facilities.
Toyota’s rivals such as Hyundai, Kia, and Honda have also pursued the same strategy and
established production facilities in the different parts of Europe.

Hyundai has established its presence in Germany, Czech Republic, and Russia from which it
gains a vantage access to the European market. Honda maintains a robust presence in the United
Kingdom and other European countries, which serve as its entry point on the European market
(Law, 2017). Kia has 30 markets spread across Europe and headquarters in Frankfurt, Germany
(Law, 2017). The company also has a production base in Zilina, Slovakia from where it manages
its design-led transformation. The various companies embrace different strategies that are
intended to endear them to their respective clients. The motive of gaining access to the markets
in different European countries is based on the need to optimize the advantages of the multi-
cultural atmosphere and unique merits of an expanded market base.

7-3. why is Unilever investing so much in emerging markets, especially Southeast Asia?
Unilever is investing in emerging markets for several reasons:

a) The countries in which they are investing are rich in resources that include people, agricultural
land, oil and gas;

b) Create a competitive advantage, capturing the demand by being first movers;

c) Diversifying their markets implementing a sustainable growth strategy and at the same time
reducing the risk of a global slowdown;

d) Labor cost is cheaper than other countries, making it easier to run operations especially in
manufacturing,

e) High turnover;

f) Excellent facilities in terms of infrastructure (in progress), ports and technology, which allow
offshoring

7-4. Myanmar is a country opening up after decades of having been closed to business due
to political Issues. Based on further data collection, explain Unilever’s investment strategy
in the country?

a) The investment's economic risk was manageable.

b) Myanmar would be a prosperous country.
c) Southeast Asia's largest continental country high potential to become Asia's "crossroad"
d) Use preferential tariff arrangements to facilitate access to major international markets
e) Unilever has the vision of creating a better future every day, and wants to do so in
Myanmar as well

f) Result: Unilever invests in Myanmar because it has sustainable growth potential, offers
natural resources and has a skilled, motivated and youthful population.

7-5. why does ASEAN represent an area of growing interest for multinationals, to the point
that some of them use it as an operations management hub? Cite clearly reasons that make
the region an attractive place for manufacturers to set up their bases?
For several reasons ASEAN represents an area of growing interest to multinationals:

a) member countries are rich in raw material sources;

b) low cost of labour;
c) They are given the geographical position of those countries
d) A great option to penetrate markets like China and India;
e) d) the channels of distribution can be established easily;
f) it represents a reduction in transport costs for some countries;
g) e) the facility to export to other countries to take advantage of the reduction in tariffs and
barriers;
h) as a multinational, be able to achieve economies of scale and create more trade between
the countries;
i) there is a friendly investment environment which is crucial for economic growth and as
result encourages more private investment.

7-6. what are the challenges for a real regional integration among ASEAN countries?
Mention some of the main issues that make it a difficult and lengthy process and their
impact on companies like Unilever?

Too complex Asia Pacific region regional trade agreements — implementing them is often too
expensive and complex for small businesses to benefit from.

a) In most Asean countries, the lack of infrastructure is still high transport costs.
b) Country diversity / Different price levels and unequal purchasing power of consumers.
c) Various levels of economic development , high political and socio-cultural diversity.