IM3081 INTERNATIONAL BUSINESS MANAGEMENT

2021-22 SEMESTER 2

INDIVIDUAL ASSIGNMENT #2

Due

Friday, 21st January 2022 at 17:00

Instructions

• Review Chapters 6 and 8 of the textbook.

• Prepare a response to the following Exercises.
• Submit both via the eLearning System on or before the due date/time.
• Be ready to present to the class your Individual Assignment #2. You will be randomly picked to
present to the class.

Exercises
Discussion questions

1. What are the potential costs of adopting a free trade regime? Do you think governments should
do anything to reduce these costs? What?
2. Drawing upon the new trade theory and Porter’s theory of national competitive advantage,
outline the case for government policies that would build nation al competitive advantage in
biotechnology. What kinds of policies would you recommend that the government adopt? Are
these policies at variance with the basic free trade philosophy?
3. The world’s poorest countries are at a competitive disadvantage in every s ector of their
economies. They have little to export. They have no capital; their land is of poor quality; they
often have too many people given available work opportunities; and they are poorly educated.
Free trade cannot possibly be in the interests of such nations. Discuss.
4. In 2008, inward FDI accounted for some 63.7 percent of gross fixed capital formation in Ireland
but only 4.1 percent in Japan (gross fixed capital formation refers to investments in fixed
assets such as factories, warehouses, and retail stores). What do you think explains this
difference in FDI inflows into the two countries?
5. What are the strengths of the eclectic theory of FDI? Can you see any shortcomings?

Research tasks

Use the globalEDGE website (globaledge.msu.edu) to complete the following research tasks:

1. Food in an integral part of understanding different countries, cultures, and lifestyles. You run a
chain of high-end premium restaurants in Vietnam, and you are looking for un ique Australian
wines you can import. However, you must first identify which Australian suppliers can provide
you with premium wines. After searching through the Australian supplier directory, identify
three to four companies that can be potential supplier s. Then develop a list of criteria you
would need to ask these companies to select which one to work with.

2. An integral part of successful foreign direct investment is to understand the target market
opportunities as well as the nature of the risk inherent in possible investment projects,
particularly in developing countries. You work for a company that builds wastewater and
sanitation infrastructure in such countries. The Multilateral Investment Guarantee Agency
(MIGA) provides insurance for risky projects in these markets. Identify the sector brief for the
water and wastewater sector; and prepare a report to identify the major risks projects in this
sector tend to face and how MIGA can assist in such projects.