Presentation on theme: "1 Can YOU define it? INTERNATIONAL BUSINESS UNIT 1 Past to Present: Global Business."— Presentation transcript:
1 Can YOU define it? INTERNATIONAL BUSINESS UNIT 1 Past to Present: Global Business
2 For centuries, people of the world have traded. From the ancient silk routes and spice trade to modern shipping containers and satellite data transfers, nations have tied their economies to the rest of the world by complex flows of products and services. Free trade, which allows traders to interact without barriers imposed by government, can improve the living standards of people because it reduces prices and increases the variety of goods and services for consumers. It can also create new jobs and opportunities, and it encourages innovative uses of resources. However, even though free trade can benefit an economy as a whole, specific groups may be hurt. While certain sectors will experience job gains, others will face job losses. Still, societies throughout history have found that the benefits of international trade outweigh the costs. WELCOME, LADIES AND GENTLEMEN, TO INTERNATIONAL BUSINESS.
3 ANY business transactions between two or more countries; activity involving business operations across national borders to satisfy objectives of individuals, companies, and organizations International Business DOMESTIC BUSINESS Any business that conducts business in only one country (aka home country)
4 INTERCHANGEABLE TERMS?? Multinational corporation (MNC) Transnational corporation (TNC) Multinational enterprises (MNE) International company Global companies Global enterprises Worldwide companies. Different title, same concept? If in doubt, use the terms international business, but each is a little different from the other. Click on this website to find out just what we mean? -between-a-global-transnational-international-and- multinational-company/ -between-a-global-transnational-international-and- multinational-company/
5 Does this business qualify as a global enterprise? Angel Sanchez was born into a family that ran a made-to-order dress business. He was an immediate success in Caracas, Venezuela when he launched his own label in Four years later, he opened a showroom in New York. He now does business around the world. Wedding dresses between $3,000 - $7,000
6 Why study International Business? We live in a world that is affected by what happens in many different parts of the world. International Business introduces you to SOME of the factors that business today needs to be aware of in order to compete in our interconnected and interrelated world. What Is Globalism? - YouTubeWhat Is Globalism? - YouTube
7 LETS TAKE A TRIP BACK TO THE BEGINNING...
8 150,000 years ago Bartering Direct exchange of goods or services for other goods or services without use of money. DID IT ALL START HERE?
9 Introduction to Globalization - YouTube AFRICA ASIA EUROPE
10 At the peak of the Roman Empire around 180 AD, how many of todays countries do you think were included within this vast Empire? 41 countires: Portugal- Spain- Andorra- United Kingdom- France- Monaco- Luxembourg- Belgium- Netherlands- Germany- Switzerland- Liechtenstein- Italy- San Marino- Vatican City- Malta- Austria- Slovenia- Croatia- Bosnia-Herzegovina- Hungary- Yugoslavia- Albania- Greece- FYR Macedonia- Romania- Bulgaria- Turkey-.. Syria- Iraq-. Cyprus- Lebanon- Jordania- Israel- Egypt- Lybia- Tunisia- Algeria- Morocco- Palestine
11 TRADING ROUTES OF THE ANCIENT WORLD Yesterday and Today
12 Built around 200 BC important supply route for caravans of mules carrying exotic goods to and from southwestern China Now largely abandoned and unkempt, its paving stones are long overgrown with grass or are missing completely. It has long been known as the Ambassador Road since early dignitaries used the route to cross back and forth between British-ruled Burma (now Myanmar) and China. About 1,600 miles from Mainland China to Burma THE LONELIEST ROAD IN CHINA THE AMBASSADORS ROAD myanmar
13 Silk road THE SILK ROAD Yesterday and Today Extent of Silk Route/Silk Road. Red is land route and the blue is the sea/water route (4,000 miles) 206 BCE Video: The Silk Road Video: Silk Production
MYTH OR FACT? Some believe that the nursery rhyme "Ring around the Rosie" refers to the Black Plague "Ring around the Rosie" - red sores on the body - first signs of infection "Pocket full of Posies" - some used herbs, flowers etc. to show others they were infected, so people could stay away "Ashes Ashes" - the bodies of the infected were burned after death "We all Fall down" - it was believed that the Black Death was the end of the world.
15 AMBER TRADE ROUTE AMBER ROAD Trade of Amber started in New Stone Age 40-60M years ago Amber is a preserved resin that embalms dust, rock sand, insects, flowers, etc Prized jewelry today The Amber Room - YouTube
16 APPIAN WAY, EGNATION WAY APPIAN WAY AND EGNATION WAY Formed GREAT EAST ROAD Sea and land routes that connected the Roman Empire and the Middle East. It is said to have been constructed to more efficiently move people and armies throughout the Roman Empire (2 ND CENTURY B.C.) Appian way (built 312 BC) 350 miles long Main sea route Egnation Way (built 145 BC) 696 miles long Major land route
17 Spice and Incense Road Incense – perfume or powerful aroma Camel-driven caravans traced a 1,500 mile route between India and Egypt to trade in exotic frankincense, myrrh, sandalwood and rare spices. This fabled passage would become forever known as the Spice & Incense Road Egypt Saudi Arabia Iraq Iran (Persia) Sudan Turkey Syria Lebanon Israel Jordan (IRAQ)
MAJOR OIL CHOKE POINTS, OIL FLOWS, & PIPELINES 19
20 SUEZ CANAL 1869 Located in Egypt (120 mi.) Links Mediterranean Sea to Red Sea 14% of world shipping 2010can accommodate Suezmax tankers SUMED Pipeline alternative to for cargos too large for Canal. Closure of the Suez Canal and SUMED Pipeline--add 6,000 miles of transit around tip of Africa, Cape of Good Hope Mediterranean Sea Red Sea Strait of Gilbraltar Cape of Good Hope Persian Gulf Suez Canal SUMED Pipeline
21 Only sea passage from the Persian Gulf to the open ocean. One of world's most strategically-important chokepoints. 20% (16-17M barrels) of the world's petroleum passes through the strait. Majority of oil exported through the Strait of Hormuz travels to Asia, the United States and Western Europe. STRAIT OF HORMUZ Strait of Hormuz
22 THE STRAIT OF MALACCA Links Indian and Pacific Oceans. Shortest sea route between Middle East and growing Asian markets. Carries about one-quarter of world's traded goods (oil, Chinese manufactures, Indonesian coffee.) ¼ of all oil carried by sea passes through the strait to Asian markets (China, Japan, and South Korea.) 1.7 miles at narrowest point, creating a natural bottleneck. Piracy, including attempted theft and hijackings, is a constant threat to tankers in the Strait of Malacca.
23 With the Panama Canal increasing in size to accommodate Suezmax ships – it could be a great thing for American agriculture, especially since 60% of our exports currently travel through the Panama Canal. Located in Panama Connects the Pacific Ocean with the Caribbean Sea and Atlantic Ocean. 14,000 vessels transit the Canal (60% headed to and from United States. Closure would greatly increase transit times and costs adding over 8,000 miles of travel. Vessels would have to reroute around Cape Horn located at the tip of South America. Canal widened to accommodate Panamax ships. Cape Horn
LOOP Louisiana Offshore Oil Port 1972 owned by Shell and Marathon Handles 13% (1.2M/d of nation's foreign oil import and domestic crude. Operates the only offshore oil port in the nation where supertankers can directly offload their cargoes of crude oil. Located in Gulf of Mexico, 20 mi. south of Grand Isle, Louisiana. 24
KEYSTONE PIPELINE 2005Pipeline for oil proposed from Canada to U.S. Plus: 20,000 high paying jobs along pipeline Plus: Injects $20B into U.S. economy Oopsone of largest freshwater reserves in world at Sand Hills, Nebraska close to pipeline. Obamain nations best interest to wait til update: rerouting pipeline in Nebraska if approved in early
Final Frontier: The Northern Sea Route A graphical comparison between the North East Passage (blue) and an alternative route through Suez Canal (red) New shipping route only open a few months a year? Could it save time and money?
27 COLD WAR IMPACT ON GLOBALIZATION
28 The United States wanted to encourage free trade throughout the world. The Soviet Union wanted to shield off her own sphere from international commerce. Russia feared that trade with the West would involve the risk of Russia being opened to western influences which would have eroded the strength of the totalitarian regime. These differences led to much ill feeling between the United States and the Soviet Union.
Cargo Network -- Nearly 90 percent of worldwide trade is made possible because products and goods are transported over the ocean on ships source: Panama Canal Suez Canal Shanghai Singapore Port of Long Beach: Life of Ocean Container - Learn international shipping & Export Documentation – YouTube Stopping Terrorism - Container Port Security - VOA Story - YouTube