NETA PowerPoint
Presentations to accompany
The Future of
Business
Fourth Edition
Adapted by
Norm Althouse,
University of Calgary
Copyright © 2014 by Nelson Education Ltd.
International: The Global
Marketplace
Chapter 5
Chapter 5
Copyright © 2014 by Nelson Education Ltd.
Making the Connection
Copyright © 2014 by Nelson Education Ltd.
Learning Outcomes
1.
2.
3.
4.
5.
4
Show why global trade is important to Canada and
how it is measured.
Explain why nations trade.
List some of the international economic
communities.
Explain how companies can enter the global
marketplace.
Discuss how governments and institutions foster
world trade
Copyright © 2014 by Nelson Education Ltd.
Learning Outcomes (cont’d)
6.
7.
5
Explain some of the threats in the global
marketplace.
List some of the trends in the global marketplace.
Copyright © 2014 by Nelson Education Ltd.
Basic Term
 Recognizing international
opportunities.
Global Vision
 Awareness of threats from
foreign competitors.
 Effectively using international
distribution networks.
6
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Show why global trade is important to
Canada and how it is measured.
7
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Canada Goes Global
Offers expanded markets for our products.
Economies of scale in production and marketing.
Ease of transfer of experience, technology.
Global recognition of products and brand names.
Possibility of uniform global image for the companies.




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Measuring Trade Between Nations
Exports
Imports
Balance of Trade
(Imports - Exports)
Balance of Payments
9
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Challenges
Economic crises of 2008 and onward.

Fluctuating value of currencies.
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
10
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Explain why nations trade.
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Why Nations Trade
Absolute Advantage
• A country can produce and sell a product at a lower cost.
• Or, the country is the only provider of the product.
Principle of Comparative Advantage
The concept that each country should specialize in the
products that it can produce most readily and cheaply and
trade those products for those that other countries can
produce more readily and cheaply.
12
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Fear of Trade and Globalization

Canadians have lost jobs.

Others fear losing their jobs.

Employers may threaten to export jobs if there are
labour disputes.

Service and white-collar workers are increasingly seeing
their operations moving offshore.
13
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Benefits of Globalization

Productivity increases.

Global competition.

Open economy spurs innovation.

Export jobs often pay more than other available jobs.
14
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List some of the international economic
communities.
15
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International Economic Communities
NAFTA
Mercosur
European Union
ASEAN
16
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Exhibit 5.2: The European Union Gets
Bigger
17
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Explain how companies can enter the global
marketplace.
18
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Entering the Global Marketplace
high risk/high return
Risk
Joint
Contract Venture
Manufacturing
Exporting Licensing
Direct
Foreign
Investment
low risk/low return
Return
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Countertrade
A form of international trade in which part or all of
the payment for goods and services is in the form of
other products.
20
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Basic Terms
exporting – sell domestically produced products to buyers
in other countries
licensing – allowing use of manufacturing, patents, or
knowledge
contract manufacturing – private label manufacturing by a
foreign company
joint venture – domestic company buys part of a foreign
company or joins foreign company to form new company
direct investment – active ownership of a foreign company
21
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Discuss how governments and institutions
foster world trade.
22
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Fostering Global Trade
Antidumping Laws
World Trade Organization (WTO)
World Bank
International Monetary Fund (IMF)
23
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Explain some of the threats in the global
marketplace.
24
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Treats in the Global Marketplace
Political Considerations
Cultural Differences
Economic Environment
Natural Barriers
Tariff Barriers
Non-Tariff Barriers
25
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List some of the trends in the global
marketplace.
26
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The Future of the Global Marketplace

Canada – Increasing its prominence in the world.

Canada – Seeking new markets.

The emergence of BRIC economic power.
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