IB7002 INTERNATIONAL BUSINESS
IB7002 INTERNATIONAL BUSINESS IB7002
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Popular in International Business
This 8 page Class Notes was uploaded by JC11 on Saturday April 9, 2016. The Class Notes belongs to IB7002 at Northcentral University taught by in Spring 2016. Since its upload, it has received 21 views. For similar materials see International Business in International Business at Northcentral University.
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Date Created: 04/09/16
NORTHCENTRAL UNIVERSITY ASSIGNMENT COVER SHEET Student: THIS FORM MUST BE COMPLETELY FILLED IN Follow these procedures: If requested by your instructor, please include an assignment cover sheet. This will become the first page of your assignment. In addition, your assignment header should include your last name, first initial, course code, dash, and assignment number. This should be left justified, with the page number right justified. For example: Save a copy of your assignments: You may need to resubmit an assignment at your instructor’s request. Make sure you save your files in accessible location. Academic integrity: All work submitted in each course must be your own original work. This includes all assignments, exams, term papers, and other projects required by your instructor. Knowingly submitting another person’s work as your own, without properly citing the source of the work, is considered plagiarism. This will result in an unsatisfactory grade for the work submitted or for the entire course. It may also result in academic dismissal from the University. IB70028 Isabel Wan, PhD International Business Assignment 1 Faculty Use Only <Faculty comments here> <Faculty Name> 2 Introduction The purpose of this week’s assignment is to evaluate economic, social, and political changes of different countries, the changing trends, and their impacts on global business. China is already seen as one of the global and great powers second to the U.S. China’s role in the global environment is significant and its influence continues to grow. As China’s role continues to increase, the influence of the U.S. decreases. Each country will need to pay very close attention to their current strategy and shift to either remain a global power by decreasing efficacy, or by identifying areas that will shift the country into the superpower position by increasing economic and military growth. The discussion specifically addresses the Challenges Facing China by answering the following: 1) The Rise and Fall of the Great Powers, 2) Efficacy Discussion, and 3) China’s Role, Challenges, and Influence. It also takes into consideration the current superpower, the U.S. and the differences between both countries as they battle for top positioning. The Rise and Fall of the Great Powers In order to be a great power, a country must develop three essential areas. A great power must be seen as trustworthy in politics, have an established and strong economic system, and a culture that people accept. A democratic culture is seen as better for the population than is communism, allowing its people greater influence and choice. This factor draws people to either immigrate into countries that are more democratic and out of those that are communistic. A stable economy provides residents with their own finances, jobs, pricing of goods and services. Now while countries may grow into a great power, they also have the tendency to fall once they get to the top due to arrogance. If a country manages to make it to the top of the superpower list, 3 it can fall just as quickly by forgetting that it needs other countries and by boasting its own success. If those in charge no longer care about the countries and the factors that brought them to power, it can just as soon lose its status. Payne (2013) discusses that there are two types of power that go into the overall factors making up a nation’s strength. These two powers are economic and military. For a country to hold the title it must have a significant presence in both. While there have been a number of changes in which countries have been delegated superpowers, the United States has remained at the top of the charts. The one point that is brought though is the fact that if a country focuses too strongly on their military presence, their economic power will suffer. This is extremely apparent with the U.S. at the present time. We as a nation have spent the last several decades at war with other nations, burning through resources and ending up $18 trillion in debt. While the U.S. continues to dig further in debt, China’s economy is thriving, and in the process it is creating one of the largest middle class’s in existence. In addition, Payne discusses the point that the U.S. is indebted to China by 22%. Unless the U.S. changes the economic direction this number will continue to grow, and the U.S.’s economy will become less stable. Efficacy Discussion To discuss the following statement “Countries with strong economies and wellmanaged political systems are able to spread their culture globally and to exercise power over other states” one must first look at the current systems in place. Currently the U.S. is the melting pot of the world. The U.S. hosts cultures from everywhere around the world and democracy appears to work well within the nation. Other countries, such as China are attempting to make changes towards a more democratic nation, but 4 must be very careful to do so without disrupting the system in place. If the disruptions are significant, it could cause China’s structure to become unstable. Feldstein, (2011) makes the most logical sense yet as he discussed how the U.S. should work to get out of debt. He states that when find yourself in a big hole, the first step is to stop digging. In the U.S. this hole continues to grow. To continue to be seen as the world superpower, the level of involvement into global issues and politics continues to grow. As of this past week, the U.S. has expanded the military’s involvement into Syria. By doing so, the U.S. shows that the superpower has the military force to take care of terrorists in yet another country. At some point though, this will be the downfall of the U.S. By trying to stay the superpower and further digging that big hole, the economy will suffer until it hits a breaking point. China may not have the ability to take over as the superpower at this point due to the issues it currently has, but in time they may overcome. In time, China may find the ability to threaten the U.S. not only in politics, the building of weapons, but by calling in the U.S’s debts. The other part the discussion must encompass is financial inequality. This discussion encompasses financial inequality not only amongst other countries, but also that of which occurs internally to one’s nation. The saying that is brought to mind is that the rich get richer and the poor get poorer. Efficacy is at the root of when a country begins its downward spiral. When a country begins to forget of the key ideals, decisions, and values at the core of it’s upward spiral, other countries as well as residents living within the country can take offense to the newfound attitude of that country. For example, if the U.S. continues down the path of a more Republican agenda where the wealthy are not charged as significantly on taxes and the population within the poverty ranks grow significantly, the U.S. will have a significant problem on its hands. This 5 inequality will certainly have an impact on the overall politics and the stability of the economy. This causes internal damage which may place the country back into a recession. If the recession then moves into the next Great Depression, the superpower will begin to waffle and fold. This concept of a country having great wealth but a poor political system is Angola. The country itself has great riches including petroleum, diamonds, fish and fresh water, but they have a significant disconnect in political stability (Payne, 2013). Other countries then back away from Angola and will take their investments elsewhere. This could be what happens with the U.S. if the deficit continues to build by trillions each year and the residents begin to utilize their democratic card by voting. Now, if the U.S. continues down it’s current path which leads to a downward spiral while China continues on it’s upward spiral, the swap of the superpower title may happen more quickly than expected. China’s Role, Challenges, and Influence China’s current role within the culture of business is to try to become as dominant as possible. China went from being one poorest countries to becoming number two according to GDP. It’s current GDP based upon purchasing power is $8.789 trillion (Ma and Tian, 2012). The U.S. as number one, comes in at $18.124 trillion. With the level of China’s level of sustained growth, it may overtake the number one slot in a relatively short period of time. Beijing’s position is being redefined based upon it’s sustained growth within the world’s economy (Passeri, 2015). China is doing this by engaging with other countries, making agreements, and playing a significant role in the economies of other countries. While they have created nuclear weapons and increased their Navy and military capacity, they have only done so to a point. This point is one where the U.S. is in agreement of with the level of their power. If 6 China continues on this path, by increasing the level of involvement with the U.S. to an even larger number where they truly begin to the hold the power, it could then increase its production of military equipment. Once the U.S. can no longer afford to fight wars and is significantly indebted to China, all that China would have to do is to begin to build equipment and increase the size of its own military. Its influence would be significant at this point and it could takeover as the next superpower. Currently the U.S. is so involved with war and terrorist nations and increasing the military presence and involvement, that the domestic economy continues to fall short. If the U.S. continues to place the Middle East at the top of the priority list and China’s focus is on increasing wealth, the U.S. could be in trouble. To become the world’s superpower is but a game of chess. Whomever knows how to play the game the best and move the correct chess pieces, will win the title. While China may appear to have the best upcoming strategy, it does have challenges of it’s own. China’s has an extraordinary population to contend within it’s borders. One of it’s main challenges in the 21st centaury is that it’s aging population. China has a current population of 1.4 billion people and by 2050, 400 million Chinese citizens will be over the age of 65, and 150 million over the age of 80. While China has created a way to control the birthing rates within the country, the elderly will certainly place a hardship on the communist nation. The hardships and expenses associated with China’s healthcare system will be significant (Fang, ScheibyeKnudsen, Jahn, Li, Ling, Guo, and Ng, 2015). Conclusion 7 The purpose of this week’s assignment was to evaluate economic, social, and political changes of different countries, the changing trends, and their impacts on global business. China is already seen as one of the global and great powers second to the U.S. China’s role in the global environment is significant and its influence continues to grow. As China’s role continues to increase, the influence of the U.S. decreases. Each country will need to pay very close attention to their current strategy and shift to either remain a global power by decreasing efficacy, or by identifying areas that will shift the country into the superpower position by increasing economic and military growth. The discussion specifically addresses the Challenges Facing China by answering the following: 1) The Rise and Fall of the Great Powers, 2) Efficacy Discussion, and 3) China’s Role, Challenges, and Influence. It also takes into consideration the current superpower, the U.S. and the differences between both countries as they battle for top positioning. 8 References Fang, E. F., ScheibyeKnudsen, M., Jahn, H. J., Li, J., Ling, L., Guo, H., & ... Ng, T. B. (2015). Review: A research agenda for aging in China in the 21st century. Ageing Research Reviews, doi:10.1016/j.arr.2015.08.003 Feldstein, M. (2011). Chapter 5: Preventing a National Debt Explosion. In , NBER/Tax Policy & the Economy (University of Chicago Press) (pp. 109144). University of Chicago Press. Ma, J., & Tian, L. (2012). Global Financial Crisis and China's Transition: Balancing Market Power with Active Role of the Government. International Economic Journal, 26(3), 379 389. doi:10.1080/10168737.2012.707877 Passeri, A. (2015). The evolving role of china in the global economy. Asian Studies Review, 39(1), 158159. Retrieved from http://search.proquest.com.proxy1.ncu.edu/docview/ 1665222811?accountid=28180 Payne, R. J. (2013) Global issues. New Jersey: Pearson Education, Inc.
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