Hao’s Summary




Hao’s Summary

            Economic globalization is responsible for increased trade in the cross-border dynamics of goods and services while enhancing the interdependence of world economy. Global culture then determines the balance between the required satisfaction in demands and supply of the traded items and their effect towards the economies. Usually, the global culture is determined by the international staffing and issues regarding labor. Through globalization, exchange of ideas, new methods, trade-offs and carried transitional changes and promoted means. Labor relations and collective bargains then create the global culture for interdependence amongst the participation nationals for economic venture.

            Outsourcing is the strategic laying out of cooperation through their operation and expansions in global scale. Through economic globalization, exchange of ideas, technology and augmented information regarding businesses, rapid development on a global scale is made possible with significant profitability measures. Outsourcing facilitates rapid development of acquired information, reduced transport costs especially in the scale of global operations, differences in wage cost help in cutting down operations to manageable levels. The knowledge intensity is increased while there is value addition in the establishment of business. Global restrictions are minimized while diversity trends are acquired easily. 

            There are potential risks involved with foreign investment and their establishment. For example, political risks affect exportation requirements, exchange rates and the fear of war and civil strife in the destination nations. There is also government default risk coupled with delayed payment according to the labor laws of the country. Investment analysis of the foreign country is necessary for prior determination in order to ensure there is control of distribution channels for the market. In risk minimization, economic, legal, technical and cultural dimensions have to be factored amongst the strategies for investment and development.  

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