GMMCH02.ppt 93KB Jun 05 2011 09:30:25 PM

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John Wiley & Sons, Inc c 1998 1

GLOBAL

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John Wiley & Sons, I nc c 1998

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Global Economic Environment

 Overview

 1. Intertwined World Economy

 2. Economic Environment Within a Nation

 3. Role of the General Agreement on Tariffs and Trade (GATT) and The World Trade

Organization (WTO)

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Global Economic Environment (cont)

 5. Information Technology and The Changing Nature of Competition

 6. Regional Economic Arrangements

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1. Intertwined World Economy

Ten Big Emerging Markets (BEM’s)

 Chinese Economic Area CEA (China, HongKong, Taiwan)

 India

 South Korea

 Mexico

 Brazil

 Argentina

 South Africa

 Poland

 Turkey

 Assn of Southeast

Asian Nations - ASEAN

(Indonesia,Brunei,Mal aysia,Singapore,

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1. Intertwined World Economy (cont)

 Exhibit 2-1 “Top Ten Countries with which US Traded Merchandise in 1995”

 Foreign Direct Investment

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2. Economic Environment Within a

Country

 market economy vs command economy

 Exhibit 2-2 “ Interrelationships Between

Control of Economic Activity and Ownership of Productive Resources”

• _{Robinson Patman and Sherman Act}

• _Keiretsus

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3. Role of GATT and WTO

 GATT

• _{Most favored nation concept (MFN)} • _{Uruguay round}

 WTO

• Exhibit 2-4 “Summary of the Final Act of the Uruguay Round of GATT”

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4. US Position in Foreign Direct

Investment and Trade

 US Direct Investment Overseas

• _{Exhibit 2-5 “US Direct Investment Abroad”}

 Foreign Direct Investment (FDI) in The United States

• Exhibit 2-6 “FDI Outlays in the US”

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4. US Position in FDI and Trade (cont)

 Balance of Payments Position

• _{Exhibit 2-8 “US International Trade in Goods}

and Services , Balance of Payments Basis 1981-1995”

• _{Exhibit 2-9 “US International Trade in Goods ,}

Balance of Payments Basis, 1981-1995”

• _{Exhibit 2-10 “US International Trade in}

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5. Information Technology and The

Changing Nature of Competition

 Trade Related Intellectual Property (TRIP’s)

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6. Regional Economic Arrangements

Multination Trading Blocs

 European Union (EU)

 North American Free Trade Agreement (NAFTA)

 European Free Trade Area (EFTA)

• EU plus Finland, Sweden, Norway, Iceland, Austria, Liechtenstein, Switzerland.

 MERCOSUR Southern Cone Free Trade Area (Brazil, Argentina, Uruguay, Paraquay plus

Chile)

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6. Regional Economic Arrangements

(cont)

 Gulf Cooperation Council (GCC) in West Africa

 South Asian Agreement for Regional

Cooperation (SAARC) India, Pakistan, Sri Lanka, Bangladesh, Nepal, Maldives,

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6. Regional Economic Arrangements

(cont)

 Free trade areas

 Customs Unions

• free trade areas plus common external tariffs = a customs union

 Common Markets

 Monetary Union

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7. Multinational Corporations

 “ in 1985, 80% of the non-communist world’s productive assets would be

controlled by just 200 - 300 companies ”