International Business | All Modules

Description: This course has been designed to introduce a variety of aspects of international business. Globalization and growing international trade amongst many different countries have brought new challenges and opportunities for many new economies and established economies.

This course analyses synthesize various models of competitive analysis to assess strategic behavior in international business.

Background: Globalization is the expansion of local economies and businesses into a broader, international marketplace. Even small businesses have gotten active in the global environment as the Internet and mobile technology have enabled communication across continents and countries. Globalization has become important for a number of reasons, including the overall need for businesses to compete.

1. The Internet:
The Internet revolutionized the business arena, because it created a whole new virtual marketplace that expands beyond physical and geographical boundaries. Companies in foreign countries can now compete for customers in the United States by leveraging their own country's resources, lower costs of labour and affordable distribution processes. In the same way, U.S. companies have the opportunity to appeal to customers in other countries by promoting goods online.

2. Developing Nations:
The development of business, industry and income levels in several large population centres has also contributed to the importance of globalization. China, India and Brazil are prominent examples of thriving economies as of 2013. Nearly two billion people reside in these countries. As customers gain buying power, U.S. companies race for the all-important capital that their revenue dollars can provide. Partnership opportunities with businesses in these countries can aid growth.

3. Competition:
Even if you want to avoid the globalization movement, you often have no choice but to compete. The influx of foreign competitors in the U.S. limits the number of companies in some industries that can succeed domestically. In the same way, if your competitors expand globally, you have to consider following suit. Any money other companies make in foreign markets, they can bring back to the United States and invest it in promoting their brands, products and services domestically.

4. Diverse Populations:
Business trends often mirror broader societal trends. The United States and the world in general have become very diverse. The United States is home to migrants from many countries around the world. As people move to different parts of the world, they spread different ideas, perspectives and customs. Foreign-born citizens who work for and buy from U.S. companies often want to see them get involved in doing business in other parts of the world.

Description: This course has been designed to introduce a variety of aspects of international business. Globalization and growing international trade amongst many different countries have brought new challenges and opportunities for many new economies and established economies.

This course examines international organisation and policies which business need to be aware of and may encounter while trading internationally.

Background: Capital Markets are markets for buying and selling equity and debt instruments. Capital markets channel savings and investment between suppliers of capital such as retail investors and institutional investors, and users of capital like businesses, government and individuals. Capital markets are vital to the functioning of an economy, since capital is a critical component for generating economic output. Capital markets include primary markets, where new stock and bond issues are sold to investors, and secondary markets, which trade existing securities.

Global Capital Markets handles the origination, structuring and underwriting of primary equities, investment-grade and high-yield bonds and syndicated loans. It has three areas:

The Capital Markets & Treasury Solutions (CMTS) group covers and serves the treasury-related needs of corporate, financial institution, sovereign and agency clients. The combined group is responsible for the delivery of the entire suite of financing, risk management and treasury product solutions (including Global Transaction Banking products) to these groups.

Equity Capital Markets (ECM) provides primary equity products including IPOs, follow-on offerings, rights issues, block trades, accelerated book buildings and convertible and exchangeable bonds. Deutsche Bank is the only firm to have book run the four largest IPOs ever: General Motors, Agricultural Bank of China, AIA Group and Industrial and Commercial Bank of China.

The Leveraged Debt Capital Markets (LDCM) franchise combines a premier high yield bond market business with diverse debt financing capabilities. Deutsche Bank is one of the few firms that can price, structure, underwrite and distribute senior, mezzanine and high yield transactions on both sides of the Atlantic.

International Monetary Fund (IMF)

The International Monetary Fund (IMF) is an international organisation created to foster global international monetary co-operation amongst its member states. It is an organisation with 185 members worldwide, with its headquarters in Washington DC., USA. Dominique Strauss-Kahn is the organisation’s current Managing Director. The IMF was formally established on December 27, 1945, when its first 29 member nations signed the Articles of Agreement.

What are the purposes of the IMF?

The first article in the organisation’s Articles of Agreement outlines the purposes of the IMF. Although the Articles have been amended three times, the first Article has not been altered. Article 1 of the Article of Agreement sets out the IMF’s main responsibilities. These are as follows:

• promoting international monetary cooperation;
• facilitating the expansion and balanced growth of international trade;
• promoting exchange stability;
• assisting in the establishment of a multilateral system of payments; and
• making its resources available to members experiencing balance of payments difficulties.

Description: This course has been designed to introduce a variety of aspects of international business. Globalization and growing international trade amongst many different countries have brought new challenges and opportunities for many new economies and established economies.

This course analyses and evaluates the complex competitive scenarios at both the firm and industry level to international business.

Background: An international strategy means that internationally scattered subsidiaries act independently and operate as if they were local companies, with minimum coordination from the parent company.

Global strategy leads to a wide variety of business strategies, and a high level of adaptation to the local business environment. The challenge here is to develop one single strategy that can be applied throughout the world while at the same time maintaining the flexibility to adapt that strategy to the local business environment when necessary. A global strategy involves a carefully crafted single strategy for the entire network of subsidiaries and partners, encompassing many countries simultaneously and leveraging synergies across many countries.

Why Do Companies Go International?

Companies go international for a variety of reasons but the typical goal is company growth or expansion. When a company hires international employees or searches for new markets abroad, an international strategy can help diversify and expand a business.

Economic globalization is the process during which businesses rapidly expand their markets to include global clients. Such expansion is possible in part because technological breakthroughs throughout the
20th and 21st centuries rendered global communication easier. Air travel and the Internet mean it is possible to manage a business from a remote location. Now businesses often have the option of going global, they assess a range of considerations before beginning such expansion.

Description: This course has been designed to introduce a variety of aspects of international business. Globalization and growing international trade amongst many different countries have brought new challenges and opportunities for many new economies and established economies.

This course applies theoretical and practical knowledge of competitive strategies in the context of globalization, particularly major entry and exit strategies of international business.

Background: This refers to an older set of standards stating how particular types of transactions and other events should be reflected in financial statements. In the past, international accounting standards (IAS) were issued by the Board of the International Accounting Standards Committee (IASC). Since 2001, the new set of standards has been known as the international financial reporting standards (IFRS) and has been issued by the International Accounting Standards Board (IASB). IASC has no authority to require compliance with its accounting standards. However, many countries require the financial statements of publicly-traded companies to be prepared in accordance with IAS.

What is Transfer Pricing?
Rapid advances in technology, transportation and communication have given rise to a large number of Multinational Companies (MNS) which have the flexibility to place their enterprises and activities anywhere in the world. The fact is that a significant volume of global trade nowadays consists of international transfers of goods and services, capital (such as money) and intangibles (such as intellectual property) within an MNS group; such transfers are called “intra‐group” transactions. There is evidence that intra‐group trade is growing steadily and arguably accounts for more than 30 percent of all international transactions. Furthermore transactions involving intangibles and multi‐tiered services constitute a rapidly growing proportion of an MNS’s commercial transactions and have greatly increased the complexities involved in analysing and understanding such transactions.

The structure of transactions within an MNS group (the component parts of which, such as companies, are also called “associated enterprises” in the language of transfer pricing) is determined by a combination of the market and group driven forces which can differ from the open market conditions operating between independent entities. Thus, a large and growing number of international transactions are no longer governed entirely by market forces, but by forces which are driven by the common interests of the entities of a group. In such a situation, it becomes important to establish the right price, called the “transfer price”, for intra‐group, cross‐border transfer of goods, intangibles and services. Transfer pricing is the general term for the pricing of cross‐border, intra‐firm transactions between related parties. “Transfer pricing” therefore refers to the setting of prices at which transactions occur involving the transfer of property or services between associated enterprises, forming part of an MNS group. These transactions are also referred to as “controlled” transactions, as distinct from “uncontrolled” transactions between companies that, for example, are not associated and can be assumed to operate independently (“on an arm’s length basis”) in reaching terms for such transactions.

Description: This course has been designed to introduce a variety of aspects of international business. Globalization and growing international trade amongst many different countries have brought new challenges and opportunities for many new economies and established economies.

This subject intends to bring these new ways of doing business and new questions in the minds of international business leaders to be discussion and provide some probable answers to these questions.

Background:

Terms of Trade - TOT
This refers to the value of a country's exports relative to that of its imports. It is calculated by dividing the value of exports by the value of imports, then multiplying the result by 100. If a country's terms of trade (TOT) is less than 100%, there is more capital going out (to buy imports) than there is coming in. A result greater than 100% means the country is accumulating capital (more money is coming in from exports).
Using the terms of trade to determine the health of a country's economy can draw the wrong conclusions. It is important to know why exports increase relative to imports, especially since the terms of trade are directly impacted by changes in export and import prices. Terms of trade measurement is often recorded in an index for economic monitoring.

For example, if, over a given period, the index of export prices rises by 10% and the index of import prices rises by 5%, the terms of trade are:
110 x 100 / 105 = 104.8
This means that the terms of trade have improved by 4.8%.

When the terms of trade rise above 100 they are said to be improving and when they fall below 100 they are said to be worsening.