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BUS 201

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vavi son

on 29 January 2013

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Transcript of BUS 201

Korea USA What is FDI ? Greenfield Investment The Company based on Australia
keen to business expansion by a "Greenfield" FDI
compare two nations for the investment P S E T E P E S T E L Political Economical Social Technological Environmental Legal Political Economical Social Technological Environmental Legal L USA Regional
Language - English South Korea Regional
Language - Hangul vs National Specification USA S.Korea Highly Diversified
World Leading
High Technology Innovation
Exports & Imports : Agriculture products Electronics
Automobile production
Exports - Wireless Telecommunication, Motor vehicle Imports - Machinery, Electronic Politically stable but minutes instances of corruption Tax benefits - 100% exemption for initial 5 years - 50% exemption for the following 2 years Free Economic Zone - Non-tariff, Non-tax sectors - Free exemption infrastructure - Less restrictions on exporting, importing for the invested firms The Foreign Investment Promotion Act - FDI insurance program - Strong buyer power GDP Big trading nation 10th largest exporter in 2009, 7th in 2010
Largest trading partner - USA, China, Japan
Trade to 200 countries Large population of early adapter - Reliable test market S.Korea is one of big trading nations in the world Plenty of highly educated labors Top technology skills Culture difference World Leading Industries - Semiconductor industry SAMSUNG, HYNIX : 15% share of world D ram market - Shipbuilding industry : 35% of world market - Automobile industry : 15th large producer - LCD, PDP, OLCD : 46% of market share of world market World class of Logistics - Incheon International Airport - Busan Port - KTX The threat of the New Entrants : moderate The threat of Substitutes : well pronounced 6 High Courts, 13 Districts Courts, Family Court and Administration Court Business Ethic : Price controls : Environmental Law : Advertising : Consumer Protection Laws : Agreement standard by the Fair Trade Commission required certain duties by the Korean Consumer Protection Act All advertising & labeling are restricted, Special regulation for specific products Installation of discharging facilities May restrict unfair price such as Monopoly Disadvantages Cultural Difference Reducing restriction would have harmful effect BUS 201 BUS 201 Hoon : Introduction
Frank : USA with PESTEL
Son : S.Korea with PESTEL
Quan: Conclusion U.S Politic System - Democratic party - Republican party Taxation System Corruption in U.S Interest rate Population and Aging distribution U.S GDP Internet Advertising Barcoding Online Shopping Weather and Climate change Climate Policy Three Levels of Law Legal System - Federal Law
- State Law
- Local Law Dominant sector attracted FDI is Manufacturing industries Less than 2000 investments in 1997 -> 14,000 investments by 2010
FDI in Korea increased by 23.8% in 2011 ($5.37 billion in 2011 against $4.33 billion in 2010 )
11.8% increased in manufacturing industries
$4.5 billion is in form of Greenfield Investment (30.5% increase in service-manufacturing sectors)
FDI inflow into manufacturing shift from low technology into more heavy, advance electrical industries. In 2011, FDI in United States is at $227.9 billion
Australia is among the top 10 countries investing into USA, 8th place
29% increase of investment from Australia into USA Highly developed financial market
Risk minimize
2nd biggest FDI country In 1997, However 2) Increase in consumer demand for modern shopping 1) In 1990s, disposable income rise Electrical goods Computer-Advantage Technology Policy and regulations to protect domestic Not welcoming foreign direct investment(FDI) inflow Asian Financial Crisis broke out Foreign Investment Promotion Act 1998 Require FDI into the country to keep the economy running South East Asian accounted half of FDI inflow into developing countries Developing countries accounted for 45% of global FDI - Greenfield FDI mainly focus on Manufacturing industries - For South Korea, Increased by 1% Accounted for $83.8 billion in 2011 1) World strongest developed economies 2) Reasons to invest in United States: In 2011, Recommendation - Corporation Taxes vary from 15%-35% - Ranked 17th of 176 countries
- South Korea 53rd
- Australia 8th $15.8 trillion in 2012 Interest rate 0.25% 315,2 million
12.4% over 65+
23.7% under 18 Culture - Consist of many level of codified and uncodified forms of law Forecasting weather - U.S climate policy announced in 2002 has 18% reduction in carbon intensive of economic production in 2012
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