THE UNIVERSITY OF DA NANG UNIVERSITY OF ECONOMICS International Business Lecturer’s Information Nguyen Thi Phuong Thao MSc. Email: thaontp@due.edu.vn Mob: 0935666220 FB Group: KDQT ky 21718 1-2 Assessment plan No Score Form of assessment 1 Score 1 Group assignment 2 Score 2 Multiple choice participation 3 Final exam Writing Pct 20% + class 20 % 60 % Total 100% 1-3 Text books Charles W. L. Hill (2014), Global Business Today, 8th Edition, McGraw-Hill Kinh doanh quốc tế hiện đại, Charles W. L. Hill, Nhà xuất bản Kinh tế Tp HCM (2014) 1-4 Course content Chapter 1 Globalization Chapter 2 National differences in political economy Chapter 3 Political economy and economic development Chapter 4 Differences in culture Chapter 5 Ethics in international business Chapter 6 International trade theory Chapter 7 The political economy of International Trade Chapter 8 Foreign direct investment Chapter 9 Region economic integration 1-5 1-6 1-7 Chapter 1 Globalization Overview Definition of globalization Global institutions 1-9 Questions 1. Definition of MNE ? 2. Are Vietnamese firms able to become multinational enterprises (MNEs) ? Why or why not? 1-10 What Is Globalization? Globalization - the shift toward a more integrated and interdependent world economy The world is moving away from selfcontained national economies toward an interdependent, integrated global economic system Globalization of markets and globalization of production 1-11 What Is The Globalization of Markets? Historically distinct and separate national markets are merging It no longer makes sense to talk about the “German market” or the “American market” Instead, there is the “global market” falling trade barriers make it easier to sell globally consumers’ tastes and preferences are converging on some global norm firms promote the trend by offering the same basic products worldwide 1-12 What Is The Globalization of Markets? Firms of all sizes benefit and contribute to the globalization of markets 97% of all U.S. exporters have less than 500 employees 98% of all small and mid-sized German companies participate in international markets 1-13 What Is The Globalization of Production? Firms source goods and services from locations around the globe to capitalize on national differences in the cost and quality of factors of production like land, labor, energy, and capital Companies can lower their overall cost structure improve the quality or functionality of their product offering 1-14 Why Do We Need Global Institutions? Global institutions help manage, regulate, and police the global marketplace promote the establishment of multinational treaties to govern the global business system 1-15 Why Do We Need Global Institutions? Examples include the General Agreement on Tariffs and Trade (GATT) the World Trade Organization (WTO) the International Monetary Fund (IMF) the World Bank the United Nations (UN) the G20 1-16 What Do Global Institutions Do? The World Trade Organization (like its predecessor GATT) polices the world trading system makes sure that nation-states adhere to the rules laid down in trade treaties promotes lower barriers to trade and investment 154 members in 2011 1-17 What Do Global Institutions Do? The International Monetary Fund (1944) maintains order in the international monetary system lender of last resort for countries in crisis Argentina, Indonesia, Mexico, Russia, South Korea, Thailand, Turkey, Ireland, and Greece The World Bank (1944) promotes economic development via low interest loans for infrastructure projects 1-18 What Do Global Institutions Do? The United Nations (1945) maintains international peace and security develops friendly relations among nations cooperates in solving international problems and in promoting respect for human rights is a center for harmonizing the actions of nations The G20 forum through which major nations tried to launch a coordinated policy response to the 2008-2009 global financial crisis 1-19 What Is Driving Globalization? Declining barriers to the free flow of goods, services, and capital average tariffs are now at just 4% more favorable environment for FDI global stock of FDI was $15.5 trillion in 2009 facilitates global production Technological change microprocessors and telecommunications the Internet and World Wide Web transportation technology 1-20 What Does Globalization Mean For Firms? Lower barriers to trade and investment mean firms can view the world, rather than a single country, as their market base production in the optimal location for that activity But, firms may also find their home markets under attack by foreign firms 1-21 Declining Trade And Investment Barriers Average Tariff Rates on Manufactured Products as Percent of Value 1-22 What Does Globalization Mean For Firms? Technological change means lower transportation costs help create global markets and allow firms to disperse production to economical, geographically separate locations low cost information processing and communication firms can create and manage globally dispersed production low cost global communications networks help create an electronic global marketplace global communication networks and global media create a worldwide culture and a global consumer product market 1-23 The Changing Demographics Of The Global Economy Four trends are important: 1. The changing world output and world trade picture 2. The changing foreign direct investment picture 3. The changing nature of the multinational enterprise 4. The changing world order 1-24 How Has World Output And World Trade Changed? In 1960, the U.S. accounted for over 40% of world economic activity, but by 2009, the U.S. accounted for just 24% a similar trend occurred in other developed countries In contrast, the share of world output accounted for by developing nations is rising expected to account for more than 60% of world economic activity by 2020 1-25 How Has World Output And World Trade Changed? The Changing Demographics of World GDP and Trade 1-26 How Has Foreign Direct Investment Changed Over Time? In the 1960s, U.S. firms accounted for about two-thirds of worldwide FDI flows Today, the United States accounts for less than one-fifth of worldwide FDI flows Other developed countries have followed a similar pattern In contrast, the share of FDI accounted for by developing countries has risen Developing countries, especially China, have also become popular destinations for FDI 1-27 How Has Foreign Direct Investment Changed Over Time? Percentage Share of Total FDI Stock 1980-2007 1-28 How Has Foreign Direct Investment Changed Over Time? FDI Inflows 1988-2008 1-29 What Is A Multinational Enterprise? Multinational enterprise (MNE) - any business that has productive activities in two or more countries Since the 1960s the number of non-U.S. multinationals has risen the number of mini-multinationals has risen 1-30 The Changing World Order Many former Communist nations in Europe and Asia are now committed to democratic politics and free market economies creates new opportunities for international businesses but, there are signs of growing unrest and totalitarian tendencies in some countries China and Latin America are also moving toward greater free market reforms between 1983 and 2010, FDI in China increased from less than $2 billion to $100 billion annually but, China also has many new strong companies that could threaten Western firms 1-31 How Will The Global Economy Of The 21st Century Look? The world is moving toward a more global economic system… But globalization is not inevitable there are signs of a retreat from liberal economic ideology in Russia Globalization brings risks the financial crisis that swept through South East Asia in the late 1990s the recent financial crisis that started in the U.S. in 2007-2008, and moved around the world 1-32 Is An Interdependent Global Economy A Good Thing? Supporters believe that increased trade and cross-border investment mean lower prices for goods and services greater economic growth higher consumer income, and more jobs Critics worry that globalization will cause job losses environmental degradation the cultural imperialism of global media and MNEs Anti-globalization protesters now regularly show up at most major meetings of global institutions 1-33 How Does Globalization Affect Jobs And Income? Critics argue that falling barriers to trade are destroying manufacturing jobs in advanced countries Supporters contend that the benefits of this trend outweigh the costs countries will specialize in what they do most efficiently and trade for other goods—and all countries will benefit 1-34 How Does Globalization Affect Labor Policies And The Environment? Critics argue that firms avoid the cost of adhering to labor and environmental regulations by moving production to countries where such regulations do not exist, or are not enforced Supporters claim that tougher environmental and labor standards are associated with economic progress as countries get richer from free trade, they implement tougher environmental and labor regulations 1-35 How Does Globalization Affect National Sovereignty? Is today’s global economy shifting economic power away from national governments toward supranational organizations like the WTO, the EU, and the UN? Critics argue that unelected bureaucrats have the power to impose policies on the democratically elected governments of nation-states Supporters claim that the power of these organizations is limited to what nation-states agree to grant the power of the organizations lies in their ability to get countries to agree to follow certain actions 1-36 How Is Globalization Affecting The World’s Poor? Is the gap between rich nations and poor nations getting wider? Critics believe that if globalization was beneficial there should not be a divergence between rich and poor nations Supporters claim that the best way for the poor nations to improve their situation is to reduce barriers to trade and investment implement economic policies based on free market economies receive debt forgiveness for debts incurred under totalitarian regimes 1-37 How Does The Global Marketplace Affect Managers? Managing an international business differs from managing a domestic business because countries are different the range of problems confronted in an international business is wider and the problems more complex than those in a domestic business firms have to find ways to work within the limits imposed by government intervention in the international trade and investment system international transactions involve converting money into different currencies 1-38 Việt Nam - Trade Total Year 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 (Millions USD) 18.399 19.907 20.818 23.143 30.084 31.190 36.439 45.403 58.458 69.420 84.717 111.244 143.399 127.045 157.075 203.656 228.310 Export 7.256 8.756 9.324 11.520 14.449 15.027 16.706 20.176 26.504 32.442 39.826 48.561 62.685 57.096 72.237 96.906 114.529 Import 11.143 11.151 11.494 11.622 15.635 16.162 19.733 25.227 31.954 36.978 44.891 62.682 80.714 69.949 84.839 106.75 113.78 1-39 ĐẦU TƯ TRỰC TIẾP NƯỚC NGOÀI TẠI VIỆT NAM THEO ĐỐI TÁC (Lũy kế các dự án còn hiệu lực đến ngày 31/12/2012) Đối tác đầu tư TT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Nhật Bản Đài Loan Singapore Hàn Quốc BritishVirginIslands Hồng Kông Hoa Kỳ Malaysia Cayman Islands Thái Lan Hà Lan Brunei Trung Quốc Canada Samoa Pháp Vương quốc Anh Thụy Sỹ Luxembourg Australia Số dự án 1849 2234 1119 3197 510 705 648 435 54 298 177 131 893 128 95 381 161 92 24 276 Tổng vốn đầu tư đăng ký (USD) 28,699,621,246 27,129,094,760 24,875,349,749 24,815,962,168 15,386,367,951 11,966,693,190 10,507,189,345 10,196,424,427 7,505,985,912 6,063,689,790 5,910,079,092 4,800,984,177 4,697,221,553 4,689,051,904 3,878,698,644 3,142,721,227 2,617,277,101 2,000,717,319 1,501,659,633 1,313,225,884 Vốn điều lệ (USD) 8,149,053,836 10,924,000,860 7,132,496,424 8,557,624,062 5,302,624,922 3,885,429,926 2,518,764,942 3,587,302,682 1,551,590,422 2,682,720,169 2,515,804,521 984,904,375 2,348,999,504 1,023,047,375 1,318,254,799 1,616,462,859 1,593,474,066 1,368,745,657 784,682,657 564,032,196 1-40 TỔNG HỢP ĐẦU TƯ RA NƯỚC NGOÀI THEO NGÀNH Các dự án còn hiệu lực lũy kế đến 20/3/2013 Ngành TT Vốn đầu tư của dự án ở nước ngoài (USD) Số dự án Vốn đầu tư của nhà đầu tư VN (USD) Vốn điều lệ của nhà đầu tư VN (USD) 1 Khai khoáng 99 23,471,679,986 7,141,904,546 4,649,717,842 2 Nông,lâm nghiệp;thủy sản 80 2,052,822,766 1,953,732,013 1,955,091,395 3 SX,pp điện,khí,nước,đ.hòa 9 2,117,875,678 1,873,869,133 1,681,222,938 4 Nghệ thuật và giải trí 5 1,239,215,000 1,239,215,000 1,238,500,000 42 1,494,470,243 1,161,643,241 965,680,444 124 718,562,144 574,916,566 526,590,566 7 Tài chính,n.hàng,bảo hi?m 28 572,844,000 538,121,900 483,371,900 8 Dv lưu trú và ăn uống 29 545,136,549 415,815,821 415,815,821 9 KD bat động sản 29 466,640,259 218,592,427 218,492,427 158 294,845,159 188,737,130 186,256,130 19 269,149,379 86,053,087 67,015,000 5 79,180,471 45,103,915 37,739,615 13 HĐ chuyên môn, KHCN 63 44,848,783 38,711,883 38,711,883 14 Xây dựng 29 57,038,134 32,052,379 30,580,379 15 Hành chính và dv? h? trợ 11 38,780,000 10,295,000 10,070,000 16 Cap nước;xử lý chat thải 2 8,900,000 7,920,000 7,920,000 17 Dịch vu khác 7 4,722,500 3,327,500 3,327,500 18 Giáo duc và đào tạo 3 8,315,700 2,085,000 2,085,000 742 33,485,026,751 15,532,096,541 12,518,188,840 5 Thông tin và truyền thông 6 CN chế biến,chế tạo 10 Bán buôn,bán lẻ;sửa chữa 11 Vận tải kho bui 12 Y tế và trợ giúp XH Tổng số 1-41 TỔNG HỢP ĐẦU TƯ RA NƯỚC NGOÀI THEO ĐỐI TÁC Các dự án còn hiệu lực lũy kế đến 20/3/2013 Quốc gia/vùng lãnh thổ TT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Lào Campuchia Liên bang Nga Venezuela Peru Malaysia Mozambique Myanmar Hoa Kỳ Cameroon Angiêri Singapore Australia Cuba Madagascar BritishVirginIslands Irắc CHLB ĐỨC Iran Haiti Số dự án 227 129 17 2 5 9 1 8 97 3 1 46 15 2 1 6 1 10 1 2 Vốn đầu tư của dự án ở nước ngoài (USD) Vốn đầu tư của nhà đầu tư VN (USD) 4,994,334,586 2,924,868,170 4,630,851,831 12,434,400,000 2,911,829,830 812,622,740 493,790,000 348,083,473 378,563,626 371,705,004 562,400,000 1,022,967,701 187,994,540 125,460,000 117,360,000 116,584,452 100,000,000 87,136,478 82,070,000 99,892,480 4,206,754,894 2,739,121,040 2,368,314,090 1,825,120,000 1,276,729,830 412,923,844 345,653,000 332,482,716 320,119,616 241,157,303 224,960,000 156,448,192 128,658,835 125,460,000 117,360,000 116,584,452 100,000,000 82,414,771 82,070,000 59,892,455 Vốn điều lệ của nhà đầu tư VN (USD) 3,997,560,877 2,680,135,740 966,314,090 1,241,120,000 772,229,830 412,923,844 345,653,000 332,482,716 317,893,616 66,913,800 224,960,000 129,855,105 127,877,335 125,460,000 117,360,000 116,584,452 100,000,000 49,664,771 82,070,000 59,892,455 1-42 TỔNG HỢP ĐẦU TƯ RA NƯỚC NGOÀI THEO ĐỐI TÁC Các dự án còn hiệu lực lũy kế đến 20/3/2013 TT Quốc gia/vùng lãnh thổ Số dự án Vốn đầu tư Vốn đầu tư Vốn điều lệ của dự án ở của nhà đầu tư của nhà đầu tư nước ngoài VN (USD) VN (USD) (USD) 21 Indonesia 7106,710,000 50,066,500 50,066,500 22 Uzbekistan 450,180,000 49,650,000 49,650,000 23 Tuynidi 236,340,000 36,340,000 36,340,000 24 Công gô 2224,880,000 23,230,000 23,230,000 25 Đông Timor 114,919,294 14,919,294 500,000 26 Hồng Kông 1415,998,875 14,909,757 14,909,757 27 Trung Quốc 1215,071,900 13,075,500 13,075,500 812,035,200 11,837,700 11,837,700 2310,618,500 8,525,500 5,025,500 30 New Zealand 187,040,000 8,475,000 8,475,000 31 Angola 65,332,387 4,532,387 4,532,387 32 Ukraina 618,237,495 3,154,495 3,154,495 174,294,167 3,130,167 3,130,167 34,150,000 2,429,900 2,429,900 28 Thái Lan 29 Hàn Quốc 33 Nhật Bản 34 Cayman Islands 1-43