CSR Exam 1 PP 1

What are the trends of the global economy in terms of growth?

The global economy has shown steady expansion but the growth is uneven and is stronger in Asia and Africa while weaker in developed regions like the European Union.

Which economies are the three largest in terms of globalization and GDP?

1. United States

2. China

3. Japan

What is the Global 500?

The ranking of the world’s 500 largest companies according to their revenue. 

Which countries/regions dominate The Global 500 now and historically?

Today the US, China, Japan, France, and Germany dominate with the US and China leading. Historically, it was the US, Japan, and Western Europe. 

Which regions account for the bulk of global trade?

East Asia (42%), North America (31%), and Europe (24%) while all other regions combined contribute only about 4%.

What are the types of firms in The Global 500?

There are two types of firms that dominate, private firms such as Walmart, Exxon, and Amazon and state owned enterprises such as Saudi Aramco, Sinopec, and the State Grid in China/Saudi Arabia. 

What is a private firm in The Global 500?

A privately owned company accountable primarily to shareholders, usually focused on profitability ex. Walmart and Amazon.

What is a state owned firm in The Global 500?

A company owned or controlled by a government, often dominating sectors like energy, aerospace, telecommunications, and infrastructure ex. Sinopec, Saudi Aramco. 

How do the firms on the most valuable brands slide differ from The Global 500 firms?

The Global 500 firms are ranked by revenue while the valuable brand list emphasizes intangible brand value, consumer recognition, and forward facing industries (tech, consumer products) rather than industrial or state owned giants. 

What is FDI?

Foreign Direct Investment is money invested in business activities in another country. It measures growth in international business. 

How is FDI measured?

By the flow of capital into another country’s businesses/assets, tracked through new facilities (greenfield investments) or acquisitions (Merger and Acquisitions)

How is FDI defined?

Foreign Direct Investment: It is the ownership or control of a business entity in another country, typically involving long term management and significant influence. 

What does FDI tell us about global trade?

FDI shows where companies are placing long term bets. Shifts in FDI highlight global economic realignment, supply chain rebalancing, and emerging markets’ attractiveness. 

What are the more recent trends of FDI? - EXPLAIN

1. FDI has slowed relative to GDP and trade.

2. Companies are more hesitant to FDI due to geopolitical risk.

3. Growth is shifting toward Southeast Asia, Eastern Europe, and Central America.

4. Strong investment in the digital economy (data centers, AI, semiconductors).

5. Declines in renewables in EU, Asia, and Africa.

6. Extractive industries are volatile but supported by demand for minerals (lithium, cobalt, rare earths). 

What are the more recent trends in trade? - EXPLAIN

1. Global trade continues growing, but protectionism and geopolitical issues create volatility. 

2. Supply chain rebalancing is driving shifts toward Southeast Asia and Central America. 

What are the more recent trends in GDP? - EXPLAIN

1. Global GDP continues to rise (3% projected growth worldwide, 1-5% per country).

2. Growth is concentrated in Asia and Africa, while developed economies like the European Union are stagnating. 

Which 3 countries dominate FDI outflows?

The United States, China, and Japan

What are two methods for executing on FDI?

1. Greenfield Investment (building operations from the ground up, ex. LEGO in Vietnam)

2. Mergers and Acquisitions (Buying existing firms or assets)

FDI investments are growing in what major sector/economy? - EXPLAIN

The digital economy, especially data centers, AI infrastructure, and semiconductor manufacturing. Demand for digital services drives investment in Southeast Asia and India. However, environmental challenges (energy, water use, e-waste) are significant. 

Who are the two largest players in FDI investments? - EXPLAIN

The U.S and China. The U.S leads in digital economy investments, especially AI and cloud infrastructure. China is strong in state-backed projects in Africa, Asia, and the Middle East (ex. Egypt’s Ras El Hekma city project). Both are shaping global supply gains and strategic sectors.