ROLE OF MULTINATIONALS Day 7

Agenda Example of work of a grant-giving agency –US Agency for International DevelopmentUS Agency for International Development –Canadian International Development AgencyCanadian International Development Agency –Australian Agency for International DevelopmentAustralian Agency for International Development Made in China Quick summary of Ch 11 Group time

Discuss issues raised in small groups How does this flattening affect specific industries, i.e. are the effects the same? –Some have already been producing off-shore, e.g. car companies, so this should be a boost –Some have not, so opportunities What is the ethical responsibility of a manager with an opportunity to offshore a portion of his or her business, at the expense of long time employees? Check out how products vary and remain the same as they go to different countries: for example, yahoo and alibaba, cell phones, etc.

Ownership of Factories in China Presented by: Sierra Hanna Curtis Monette Sean Krause Andrew Weekly Paint Factory in China

Purpose To examine who owns the manufacturing plants in China, the process in which companies received authority to run the manufacturing plants, and the conditions under which they run the plants.

Who owns the factories in China “Only 220 of the biggest enterprises in the manufacturing industry are directly controlled by the state” according to a survey by the National Bureau of Statistics (Chinese State Owns Less Than Half Of Top 500 Manufacturing Companies)

Table of Factories CompanyCountry or OriginProduct(s)Location of Plant(s) Anorad part of Rockwell Automation Shirley, New York Milwaukee, WI, USA Linear MotorsDongcheng District Beijing Changan Ford Mazda Engine Company Ltd. (CFME) Dearborn, Mich. (Ford) Japan (Mazda) Engine production facilityNanjing, China MAHLE GroupStuttgart, GermanyPiston production plantsYingkou, China Nanjing, China Chongqing, China LEESHRSino-Korea joint venture companyAuto Parts and AccessoriesCHANGSHU ECONOMIC DEVT ZONE Changshu Jiangsu, China Evensun Co.,Ltd ChemicalsGuangDong, China NortelUSACommunicationBeijing Cypress IndustriesAustin, Texas and Taipei, Taiwan, R.O.C. Plastics and Metal ProductDong Guan City and Shenzhen City, China IntelUSAMicro ProcessorsLiaoning Province Taiwan Semiconductor Manufacturing Co. Taipei, TaiwanComputer chipsShanghai Min Jen Enterprise Co., Ltd.Taoyuan, TaiwanLCD monitors and LCD TV monitors Somewhere in China POSCOPohang, South KoreaSteelBeijing, Shanghai, Guangzhou, Wuhan, Shenyang, and Wanchai, Hong Kong Ace Korea, lnc.Busan, KoreaAKI-BOARD, AKI-TILE of 100% Natural Gypsum Ceiling Tile and MgO Board WUHAN and JANGSU

Taiwan in China Designed by someone, somewhere. Sent somewhere. Assembled & Made somewhere. Apple, Garmin, Microsoft, Cisco, Nike, Sony Taiwan is known for its strengths in reliable sourcing, leading technology and complex integration-and they get all the jobs done in China.

Taiwan in China Does the average consumer in the United States who buys an iPhone, an Xbox 360, a wireless router, or a Garmin GPS device know it’s from Taiwan? Designed by someone in the United States. Sent to Taiwan. Assembled & Made in China

* Many foreign firms, including U.S. companies, are registered in the Virgin Islands, Cayman Islands, and Western Samoa for tax purposes. Source: U.S. $ Foreign Commercial Service and U.S. Department of State Top Sources for Foreign Direct Investment in China (US $ billions) Country/Region Hong Kong $16.7$17.8$17.7$18.9$17.1$17.8 Virgin Islands* $5.0$6.1$5.7$6.7$9.0$9.4 Japan $4.3$4.2$5.0$5.4$6.5$6.0 South Korea $2.1$2.7$4.5$6.2$5.2$5.9 Taiwan $2.9$3.9$3.4$3.1$2.1$3.8 United States $4.4$5.4$4.2$3.9$3.1$3.4 Singapore $2.1$2.3$2.0 $2.2$2.1 Germany $1.2$0.9$0.8$1.0$1.5$1.4 All Sources $46.9$52.7$53.5$64.0$60.3$63.4 FDI in China

Ch 11 - summary There are 7 rules proposed by Friedman. By groups, explain to the class what a rule means or suggests a company does and provide an example not in the book.

Rules Dig inside yourself The small shall act big The big shall act small Collaborate Get regular x-rays Outsource to win, not to shrink Outsourcing is also for idealists

Term Project Proposal due? Questions on what is required? Spend time organizing