©2004 Prentice Hall2-1 Chapter 2: Global Marketplaces and Business Centers International Business, 4 th Edition Griffin & Pustay

©2004 Prentice Hall1-2 Chapter Objectives_1  Evaluate the impact of the political and economic characteristics of the world’s various marketplaces on business  Appreciate the uses of national income data in making business decisions  Discuss North America as a major marketplace and business center in the world economy

©2004 Prentice Hall1-3 Chapter Objectives_2  Describe Western Europe as a major marketplace and business center in the world economy  Discuss the problems facing the economies of the former communist countries of Eastern and Central Europe

©2004 Prentice Hall1-4 Chapter Objectives_3  Discuss Asia as a major marketplace and business center in the world economy  Assess the development challenges facing African, Middle Eastern, and South American countries

©2004 Prentice Hall1-5 Vital Information in International Business  Basic geography  Market characteristics  Culture  Politics

©2004 Prentice Hall1-6 World Economic Activity  Triad –Japan –European Union –United States  Quad –Triad –Canada

©2004 Prentice Hall1-7 Figure 2.1 Shares of World’s GDP, 1970

©2004 Prentice Hall1-8 Figure 2.1 Shares of World’s GDP, 2001

©2004 Prentice Hall1-9 Classifying Countries by Income Levels High Income Countries $9,206+ annual per capita income Lower Income Countries $725 or less annual per capita income Middle Income Countries $745 - $9,206 annual per capita income Least Developed Low literacy rates, Low per capita income Lack of infrastructure

©2004 Prentice Hall1-10 High Income Countries Cluster 1: OECD member countries Cluster 3: Hong Kong, Israel, Singapore, Taiwan Cluster 2: Kuwait and United Arab Emirates

©2004 Prentice Hall1-11 Marketplaces of North America  United States  Canada  Mexico  Greenland  Central America  Caribbean islands

©2004 Prentice Hall1-12 Map 2.1 North America

©2004 Prentice Hall1-13 United States  3 rd largest population in world  4 th largest land mass  Largest economy  2001 GDP: $10.2 trillion  Prime market for lower-income countries trying to raise standards of living through exports

©2004 Prentice Hall1-14 Figure 2.2 Headquarters of World’s Largest Corporations in 2000 by Country

©2004 Prentice Hall1-15 Canada  2 nd largest land mss  80% of population concentrated in a 100-mile band along U.S./ Canadian border  Rich natural resources  Trade with U.S. - single largest bilateral trade relationship in world

©2004 Prentice Hall1-16 Advantages of Canada  Proximity to U.S. market  Stability of legal and political systems  Excellent infrastructure and educational systems

©2004 Prentice Hall1-17 Mexico  Largest Spanish-speaking nation  Federal government system  Participant in NAFTA along with U.S. and Canada

©2004 Prentice Hall1-18 Central America and Caribbean  Population collectively of 74 million  Total GDP of $199 billion  Economic development hindered –Political instability –Chronic U.S. military intervention –Inadequate educational systems –Import limitations

©2004 Prentice Hall1-19 Marketplaces of Western Europe  Group 1: European Union (EU) member countries  Group 2: Other countries in region

©2004 Prentice Hall1-20 Map 2.2 Western Europe

©2004 Prentice Hall1-21 Marketplaces of Eastern and Central Europe –Bosnia-Herzegovina –Croatia –Macedonia –Slovenia –Serbia –Montenegro  Eastern Europe –15 countries resulting from disintegration of Soviet Union  Central Europe –Albania –Austria –Bulgaria –Czech Republic –Slovak Republic –Hungary –Poland –Romania

©2004 Prentice Hall1-22 Map 2.3 Eastern Europe

©2004 Prentice Hall1-23 Map 2.4 Central Europe

©2004 Prentice Hall1-24 Marketplaces of Asia  Japan  Australia and New Zealand  The Four Tigers  China  India  Afghanistan and Central Asian Republics  Southeast Asian Countries

©2004 Prentice Hall1-25 Map 2.5 Asia

©2004 Prentice Hall1-26 Map 2.6 Australia and New Zealand

©2004 Prentice Hall1-27 The Four Tigers  South Korea  Taiwan  Singapore  Hong Kong

©2004 Prentice Hall1-28 Marketplaces of Africa and the Middle East  Africa –815 million people –54 countries  Middle East –Cradle of civilization

©2004 Prentice Hall1-29 Map 2.7 Africa and the Middle East

©2004 Prentice Hall1-30 Map 2.9 South America