1. CHAPTER 5 – INTERNATIONAL AGREEMENTS, ORGANIZATIONS, AND POLICIES.
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CHAPTER 5 – INTERNATIONAL
AGREEMENTS, ORGANIZATIONS, AND POLICIES.

2. 5.1 Positioning in the Global Economy
Positioning starts with a product, a piece of merchandise, a service, a company, an institution, or even a person.
To position itself in world markets, a business must establish what makes its products or services unique and superior to others. (image and reputation)
Visibility among trade partners

3. Strategies toward Global Positioning
By exporting or importing
Franchising a business operation
Starting up a wholly owned subsidiary
Purchasing parts/materials in foreign markets
Establishing a joint venture
Strategic alliance

4. International and Global Companies
Global economy is based on the interdependence of competitors, markets, and resources.
A global company is one in which top management makes decisions to maximize worldwide revenues, income, and profits
BENEFITS AND CHALLENGES IN GLOBAL COMPANIES – PAGE

5. 5.2 Corporate Globalization
Globalization refers to the growth and spread of interactive international economies and businesses around the world.
A Multinational company (MNC) is a business enterprise that conducts business in several countries.
The global influence of these economies is illustrated by their dominance in the following areas: oil and gasoline, hydroelectric and nuclear plants, minerals, construction of transportation crafts, lumber and agriculture.

6. Multinational companies
Ethnocentric MNC e.g. Coca-Cola's headquarters in Atlanta, Georgia control most of the company’s foreign affairs.
Polycentric MNC e.g. 3M corporation – 35,00 of its employees are positioned in countries around the world
Geocentric MNC (uncommon) e.g. Colgate-Palmolive

7. Challenges to Multinational Organizations
Developing global customers beyond the Triad.
Multinational companies sometimes dominate economies and try to influence governments.
Creating new international divisions of labour

8. Global Organizational Structure
Separate International Divisions
Functional Divisions
Product Divisions
Geographic Divisions
Matrix Organization

9. 5.3 International Trade Agreements
There is an increase need for trade agreements
Trading Blocs
Reciprocity
Bilateral trade/multilateral trade
NAFTA, FTAA, EU, APEC
Agreement on Internal Trade (AIT)
Free Trade or Duty-Free Zones

10. 5.4 Organizations Influencing Global Trade
G20 – An international forum of finance ministers and central bank governors.
World Trade Organization(WTO)
World Economic Forum (WEF)
Organization for Economic Cooperation and Dev.
World Bank Group
International Chamber of Commerce (ICC)
International Monetary Fund (IMF)
National Organizations