Year 10 GCSE Economics - BSAK Weebly

Year 10 GCSE Economics
3.4 Globalisation / FDI (p59)
Understand why foreign firms choose to
operate in the UK.
Understand the consequences for the UK
economy when overseas firms relocate.
Apply understanding to Kraft takeover of
Key terms
• Foreign Direct Investment (FDI): When a
business from one country builds a factory
in another.
Reasons why foreign firms locate in the UK
• Access to highly skilled labour workforce
• Instant access to EU without trade barriers
(500 million + consumers)
• Access to British brands and distribution
networks. Example Cadburys retailers for
• English language accepted international
language for business, science and
Problems when foreign firms exit
UK market
• Jobs lost directly in local economy
• Government lose taxation
• UK firms that supply the business lose
revenue and may make job cuts
• Government may need to spend money on
education and retraining in the region
Example successful FDI in UK:
Cadbury’s / Kraft
case study
• Create a timeline display of the Kraft takeover of
• Identify the reasons ‘for’ (Kraft’s) decision to
takeover Cadburys.
• Identify the arguments “against” the takeover.
• Analyse the consequences on at least three
different stakeholders of the takeover. Please
include actual evidence from the media to
support your analysis.
• Your findings should be reported in a ppt
Web links for research: