Global Finance and Business
Transcript: Multinational Corporation and controversy: -Subsidiary located overseas is likely to become the target during political riots and conflicts. -Sometimes it could lead to diplomatic intervention. 2012 China anti Japan protest(due to Diaoyu Island dispute): Japnese government announced the Island is a part of Japan More than 50 cities in China organised large scale of demonstration and some of them resulted in violent incident. E.g. overturned Japanese-made police cars and smashed the windows of Japanese restaurants. Japan and China reponsed like: Japanese Prime Minster and the Japanese diplomatic department condemned usage of violence. Chinese government took an mild reproof of that and made a complaint against Japan. 2014 Vietnam anti-China protest (due to the placement of an oild rig in the disputed South China Sea) 2016 China boycotted US product(due to South China Sea arbitration) Private Actor Global business refers to international trade whereas a global business is a company doing business across the world. Multinational business states are the main rule makers for currency exchange and other international economic transactions, those transactions are carried out mainly by private firms and individuals, not governments. Asian Infrastructure Investment Bank Established in 2014 Eurozone sovereign debt crisis during 2008-2009 Financial crisis of 2007- 2008 Multinational Corporations(MNCs) is an important actor. Two and most important sort of corporation Industrial corporations: factory which makes goods in various countries and sell them to businesses and consumers. Example: super power states; Financial corporations: including individual banks, firms, companies; -And...how does market integration afftect corporation? Example: In 1995 a trader in Singapore lost $1 billion in stock markets and bankrupted his employer, a 200 year-old British investment bank -Asian Infrastructure Investment Bank -New Development Bank (Serve China and Russia interests more) -International Money Fund -World Bank -European Central Bank -Asian Development Bank (Serve more Western Interest) What is Business ? What is Global Finance ? International currency exchanges Interbank Forexbank Does Finance matter with Business? IMF website AIIB website Book: Rodmand, Kenneth A. Sanctity versus Sovereignty : US policy toward the Nationalization of Natural Resource Investments in the Third World. News site: http://cn.reuters.com/article/japan-china-protest-diaoyu-islands-idCNCNE87J04A20120820 http://latimesblogs.latimes.com/world_now/2012/08/china-japan-territorial-tensions-flare.html http://zasshi.news.yahoo.co.jp/article?a=20161203-00003891-besttimes-pol&p=2 Financing through stock markets is optimal for industries where there are continuous technological advances and where there is little consensus on how firms should be managed. The stock market checks whether the manager's view of the firm's production is a sensible one. The International Monetary Fund (IMF) Biography Thanks! :) Why do states go into debts ? Three main reasons. The US and Japan are not member Financial Market- - Currency Ashley & Yenish Main two tools to fix local debts: Financial Market-International debts Interest rates is the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets. AIIB (continue) Fiscal policy - government decisions about spending and taxation Monytary policy - decisions about printing and circulating money Global Business- How does MNC work and controversy Africa were hit hard in 2008, IMF gave loans to places like Ghana in 2009 and their growth rate increase to over 9% in 2011 Global Finance and Business (Financial Market, Actors and Multinaitonal Corporation) (2) Aim: Different from IMF, World Bank. AIIB focus on infrastrcture development, e.g.transportation and urban development. (3) Aim from a political aspect: An stretegy of China to enhance its soft power and voting power. as a second largest economy in the world China has only 4% voting power in IMF while US has 17.69%. (1)Benefits: Investment and assets to developing countries create jobs Infrastructure Technology (2)Critics: Exploit poor workers/countries decapitalise the host country stifle domestic innovation and economic activities Global Business and Politics- MNC and Government Relations Financial Market-International crisis Intergovernmental Organization (1) An organization of 189 countries (2) Established in 1945 in order to avoid a repetition Great Depression of the 1930s. (3) Aim: Ensure stability of the international monetary system (4) Biggest borrower includes: Portugal, Greece, Ukraine, Ireland (5) Biggest precaution borrower: Poland, Mexico, Colombia, Morocco (6) Where does the IMF get its money? Mainly: Quota System Why Currencies rise or fall? -Finance is an offshoot of economic. → -Pricing and valuation Examples: Interests rates, money flow, investment and financial market.
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