Preparation of Exam Paper

Preparation of Exam Paper

Course: International Business Environment

MBA, BBU, Kampong Som Province

Academic Year: 2008-2009

1. Please define the terminology of International Business Environment and indicate the differences and classification of the environment affecting international business by using your reading material and guide to simplify the modality of the business operation in Cambodia?
2. Using the success of international business in Cambodia, what are core interventions taking into international markets? What are the major critical forces slipping into Cambodian business environment, and inter alia what are the generic causes to create and to damage the entrepreneurs here? It is noteworthy that your major findings are really appreciated and are strongly encouraged to share among us.
3. As you have studied International Business Management and Environment, the global investors are the foremost central issues in playing the important role for a recurring theme of global capital flow and the pursuit of both wealth and developing economies. With this statement, it seems that some facts can support the virtue of global investors, and therefore, it shall be your opinions to elaborate the facts.
4. Since Cambodia becomes a member of the WTO, Globalization is appeared to be a new phenomenon for all. What are the major forces of globalization affecting the international business in the country? 
5. By initiating your critical thinking and reflecting countries like Cambodia and China, Could you define attractive conditions and market potentials for operating international businesses. What are gains of trade between both countries as a mutual cooperation is tightening?
6. Why do they say that the current economic recession in Cambodia resulting from the global economic crisis is caused by a decreasing Foreign Direct Investment (FDI)? Could you let us know what is the importance of the FDI and how is the impact on Cambodian Society and Economy?
7. Using the Economic Indicators, what are the major determinants on international business and what is the business opportunity in LDCs? In the context of Cambodia, What is the opportunity and threat for foreign business operating inside Cambodia?
8. What is the basis of Global Market Segmentation? If Cambodia is the major agricultural and garment product export-oriented country, Could you clearly define the potential markets and market segment for the nation? What are the role and commitment of the Royal Government of Cambodia to create an enabling environment for this export effort?
9. In a current effort made by many countries to sustain economic growth is uncertain because the school of thought is seemingly unpractical and inefficient in terms of trade management, Do you have any conceptual thought to be more creative and fostering trade and economic development in Cambodia by applying the international business environment context?   
10. After you have completed studies of international business environment, could you please indicate the importance of the studies and how to develop enabling environment to attract foreign direct investment into the country? Again, what is your recommendation for integrated Cambodian domestic businesses into global markets, and therefore, what is your hope for long-term business prosperity for the nation. It is noted that answering the question lies within your conceptual and critical thinking, and no single clear-cut to have a perfect explanation.

 

Remember Note:

This exam shall be returned within 2.30 hours of examination time whether it is by mailing or writing, and otherwise, the BBU regulation will apply to late submitted students.

Answer Modelling for Preparation of Exam Paper

Course: International Business Environment

MBA, BBU, Kampong Som Province

Academic Year: 2008-2009

3

1. Please define the terminology of International Business Environment and indicate the differences and classification of the environment affecting international business by using your reading material and guide to simplify the modality of the business operation in Cambodia?

Answer Question 1

·  Definition

   IBE is the study of business activities concerning the cross-national and tran-national operations under external and internal forces. For example, the Multi-National Companies are generally managing their businesses at cross borders and require the ability to deal with the challenges presented by these unique features of IBE.  

          

·  Classification and Differences of Environment Affecting IB

There are three classification of environment affecting IB and those are:

A.    Domestic Business (Environment) is the local merchandise or trade owned by local stakeholders at the domestic markets.

B.     Foreign Business (Environment) is a diversified company of domestic business operating in a foreign country.

C.     International Business (Environment) is the corporations running their business at cross-borders/boundaries or overseas. There are four types:

-          Multi-National Corporations (MNCs) is the IB operating more than one countries. It is a mixture of owners and national-international sales, and it is generally an identical strategy proceeded in different markets. It produces commodities for domestic consumption of the countries in which they operate.

-          Tran-National Corporations (TNCs) is similar to MNCs, and yet it produces commodities to meet the markets of the third countries.

-          Global Corporations (GC) indicates a firm attempts to standardize operation worldwide in all functional areas.

-          International Corporation (ICs) is all MNCs, TNCs and GC.

2. Using the success of international business in Cambodia, what are core interventions taking into international markets? What are the major critical forces slipping into Cambodian business environment, and inter alia what are the generic causes to create and to damage the entrepreneurs here? It is noteworthy that your major findings are really appreciated and are strongly encouraged to share among us.

Answer Question 2

 

·  Core Interventions Entering into IMs

-          Flow of capital shall be globally as the target market is saturated, and the gains will be distributed and increasing consumer purchasing power.

-          Labour movement is naturally unrestricted and exchange of experience, cooperation and good practices will be better off for the international markets, and gains will be harmonizing society.

-          Technology development and movement will rescue the fate of poor developing countries as both agricultural and light industrial productions have extended beyond its limit to growth.

-          Removing trade barrier and entering globalization will a shock and success as many countries are aware of internal and infrastructural development, and enhancing competitiveness. 

·  Critical Forces

-          Internal Environment: Production, Finance, Marketing, Human Resources and Research Activities are all internal strengths to experience with growth, success and competition. It is also so called Micro-Environment. 

-          External Environment has four layers such as Domestic Environment, Foreign Environment and Global Environment or it so called Macro-Environment.

·  Generic Causes of Success and Failure

-          Political and Macroeconomic Stability is an ultimate desire for business operators in the country.

-          Legal reform and system is a critical force of success and exit industry.

-          Capital adequacy is one of the major balances in business operation and compensation.

-          Government intervention during a crisis and social shock is a major step towards developing a minimum standard of business rescue and re-entrance into the market.

·  Major Findings

-          Cambodian Bankruptcy Law does not indicate clearly how the international corporation shall be reserved some budget

-          Tax Holliday waived for international corporations shall be reviewed to benefit both the government and employers.

-          The Limitation of Capital Flow-Out shall be agreed by both government and employer association to protect the interest of the nation and to escape the imbalance of trade. 

-          Unfair Practices and Restrictions shall be removed to create an enabling international trade environment.

3. As you have studied International Business Management and Environment, the global investors are the foremost central issues in playing the important role for a recurring theme of global capital flow and the pursuit of both wealth and developing economies. With this statement, it seems that some facts can support the virtue of global investors, and therefore, it shall be your opinions to elaborate the facts.

Answer Question 3

 

·  Global Investors

-          International Investors are prophets of profit, and there is no border or sovereignty to delineate their potential business.

-          International exchange with free flow of capital below a limitation, and affordable bond rate and information flow can create a favourable environment for global investors.

-          Looking for emerging and potential markets is a journey to prosperity as it represents a need of global investors.

-          Fiscal and monetary policy shall be conducted as a standard or global integration in order to encourage a good atmosphere for operating worldwide business, and that is a global act of global investors.

-          Roles of international aid and tax heaven shall be transferable and re-inning a herd to ensure the sustainability and independency.

·  Fact Findings

-          Social and Moral Ethic (Corporate Social Responsibility) shall be inclusive into the investment and corporation law.

-          Understanding the dynamics of the global marketplace is important to pursuit regional and international integration to avoid a limit to growth and abundance.

-          Sustainability and competitiveness remain a standard setting for Cambodia as well as the LDCs to attract global investors and to build the capacity of the future generation be act globally with local experiences from global investors.

-          Roles of the State and Visions are the roadmap and continuum plan for better and smarter development of the country using the lesson learnt from international investors.  

4. Since Cambodia becomes a member of the WTO, Globalization is appeared to be a new phenomenon for all. What are the major forces of globalization affecting the international business in the country? 

Answer Question 4

 

·  Forces of Globalization

-          Globalization is world without wall and without barriers or borders, and hence, 

-          Macro-Environment is a global force affecting domestic, foreign and multi-national corporations.

-          EPRG Framework shall be conducted and used to seek the best alternative to opportunity for developing business.

-          Cross-learning and outward-looking is a challenge for growth and a world-resource sharing.

·  Response to Globalization

-          Developing core competency and standard for commodities, services and labourers.

-          International Property Right and other trade treaties are inconvenient and undesirable for the LDCs, and therefore remaining a challenge ahead for growth and civilization. 

-          Trade relationship and international cooperation is a political will for enforcing the out-boundary trade and business.

5. By initiating your critical thinking and reflecting countries like Cambodia and China, Could you define attractive conditions and market potentials for operating international businesses. What are gains of trade between both countries as a mutual cooperation is tightening?

Answer Question 5

 

·  China versus Cambodia Attractions

	-    High population and Demand -    One political system and law enforcement -    Diversified industries and resources -    Low labour costs among BEMs -    Strong human and social capital		-          Natural beauty and resources -          Agriculture -          Tourism -          Low labour costs among LDCs -          Freedom of movements

 

·  Gains from Cooperation

-          Cambodia will gain from cheap input to import while China will enjoy the free movements of capital flow into Cambodia as a positive relation.

-          Cambodian resources (Land for production, Minerals and Industrial Land) are the major absorption of Mainland China while Cambodia will gain from employment, resource rent, and national inflow of income and trade.

-          As a country trade partner, financial assistances and loans will be a inevitable need for growth and corporate shares.  

-          Other benefits will be political, social, economic and cultural mutual interests.

6. Why do they say that the current economic recession in Cambodia resulting from the global economic crisis is caused by a decreasing Foreign Direct Investment (FDI)? Could you let us know what is the importance of the FDI and how is the impact on Cambodian Society and Economy?

Answer Question 6

 

·  Recession as Causes of FDIs

-          Decreasing FDIs will retard all investment portfolio which is a core component of GDP (C + I + G + NX)

-          Frozen assets and devalue of services is harmful to the standard of livings of the people and creates heavily unemployment.

-          National budget from fiscal collection remains inadequate and downsizing expenditure will limit both export of commodities and business activities

-          Discouragement of capital movement, diversification and increasing debts for investors and creditors.

·  Importance and Impact of FDIs

-          Equity Capital

-          Re-invest earning

-          Intra-company loans

-          Others: better management, skill and technological development, resource mobilization, and other spill-overs

 

7. Using the Economic Indicators, what are the major determinants on international business and what is the business opportunity in LDCs? In the context of Cambodia, What is the opportunity and threat for foreign business operating inside Cambodia?

Answer Question 7

 

·                                                        Major Economic Indicators Impact on IBE

-          GDP per capita and Distribution of Income have an absolute effect on IBE through the indication of Purchasing Power Parity of commodities, economic growth with a life style consumption changes, and relatively wealth creation in business sectors.

-          Labour costs per unit of production and other competitive environments will be a crucial determinant on the investment attraction and an incentive trade for foreign business in the country.

-          Levels of consumption and population would be

-          Other macroeconomic performance indicators such as inflation, interest rate and exchange rate are also affecting the flows of international trade and gains from international business operations between countries.

·                    Business  Opportunity in LDCs

-          Low labour costs and asset values are seen a beginning foreign business exploration as basic opportunity without thinking the risk occurring.

-          Some export and input import levies are general provisions for new entrance business and therefore, opportunity for expansion of business is likely profitable for foreign operators.

-          Quota and good working conditions applied for the LDCs can be hopeful for long term foreign direct investment and diversified business through growing capital allocation in the nation.

-          Green and underground exploitation businesses are seemingly an interest of foreign companies to bring an innovation and capital for export products.

·                    Opportunity and Threat for Foreign Business in Cambodia

-          As we have mentioned in business opportunity in LDCs, Cambodia has the similar resource endowment and characters.

-          The threats are also mentioned in answering question 2 on major findings.

8. What is the basis of Global Market Segmentation? If Cambodia is the major agricultural and garment product export-oriented country, Could you clearly define the potential markets and market segment for the nation? What are the role and commitment of the Royal Government of Cambodia to create an enabling environment for this export effort?

 Answer Question 8

 

·                                                        Global Market Segmentation

-          First, it is an identification of markets where there are homogeneous attributes exhibiting a similar consumer behaviour.

-          Second, it is to develop a market as a result of worldwide response of consumer demand, which is demographics, psychographics, behavioural characteristics, and country environment.

·                                                        Potential and Segmented Markets in Cambodia

-          Premium or niche markets are generally the markets located in European and North American Countries where the customers require natural/non-chemical and high quality commodities.

-          Standard markets are generic markets of satisfying consumers in Middle Eastern Asia and Eastern European Countries where the commodities should be benchmarking within the minimum quality assurances.

-          Economic markets reflect desired commodities with lower costs, and there is no rules of quality or quantity limited.

·                                                        Roles and Commitment of the RGC

-          Regulation all forms of business and investment policies and laws to create a favourable environment for foreign business, and to improve the good governance of business sectors.

-          Exploring and expansions of all country business potential in agriculture shall be in line with sustainable development.

-          Tax Heaven/Holliday or Tax Exemption shall be appropriate and fairly practices to encourage competitiveness and equity.

-          Developing a modality where both consumers and investors shall be protected and respected the freedom of entrance and exit in the free market economy is a common form for long-term business development plan.

9. In a current effort made by many countries to sustain economic growth is uncertain because the school of thought is seemingly unpractical and inefficient in terms of trade management, Do you have any conceptual thought to be more creative and fostering trade and economic development in Cambodia by applying the international business environment context?  

Answer Question 9

 

·                                                        Schools of thought and ability to grow

-          Neo Classical School has shifted from export-orientation to self-reliance. India and China using holistic approaches of industrial and agricultural development can be self supply and minimise the export reliance.

-          Increasing internal public expenditure on human capital and technological innovation to replace import demand is considered to be more effective and sustainable tools.

-          Reducing dependency rate on foreign aid and foreign direct investment is likely a development of internal self esteem and to escape from international pressure on political decisions.

-          Growing import substitution is the way to promote the domestic business and agricultural production.

·                                                        Creativity and Economic Development

-          Trade negotiation and increasing country competitiveness are one of the key economic development strategies.

-          Innovation and entrepreneur skill development could shift the retard growth to potential growth.

-          Other social, cultural and legal reforms can create a good business environment and contribute macro-economic stabilization. 

10. After you have completed studies of international business environment, could you please indicate the importance of the studies and how to develop enabling environment to attract foreign direct investment into the country? Again, what is your recommendation for integrated Cambodian domestic businesses into global markets, and therefore, what is your hope for long-term business prosperity for the nation. It is noted that answering the question lies within your conceptual and critical thinking, and no single clear-cut to have a perfect explanation.

Answer Question 10

 

·                                                        Importance of the Study and Attraction of FDIs

-          Understanding cross border issues and tran-national companies 

-          Promoting the knowledge on globalization and its impact

-          Experiencing the trade and business issues in the new era of global competition

-          Developing a generic action plans and policies to adapt with the Neo-IBE

-          Cross-learning the success and failure affected by external market decisions 

·                                                        Recommendation to Enter the Global Markets

-          Strengthening the legal framework and capacity of domestic companies to integrate into regional and global markets.

-          International and regional trade cooperation and political environment shall be supplemented into diversify domestic companies to global companies.

-          Exchange information and sharing the cultural and historical value to be all gained from trade.

-          Property right and standardized product development and markets to ensure the long term and sustainable business into global competition.

 

Remember Note:

This exam shall be returned within 2.30 hours of examination time whether it is by mailing or writing, and otherwise, the BBU regulation will apply to late submitted students.