Companies Expanding Internationally

$global outsourcing:$ aka offshoring
- using suppliers outside of the United States to provide labors, goods, or services
$importing:$ a company buys goods outside the country and resells them domestically
$exporting:$ a company produces goods domestically and sells them outside the country
$counter-trading:$ bartering goods for goods
$licensing:$ a company allows a foreign company to pay it a fee to make or distribute the firm’s product or service
$franchising:$ a company allows a foreign company to pay it a fee and a share of the profit in return for using the company’s brand name and a package of materials and services
$joint ventures:$ formed with a foreign company to share the risks and rewards of starting a new enterprise together in a foreign country
- aka “strategic alliance”
$wholly-owned subsidiary:$ foreign subsidiary that is fully owned and controlled by an organization
- $“greenfield venture”:$ foreign subsidiary that the owning organization has built from scratch

$World Trade Organization (WTO):$ designed to monitor and enforce trade agreements
- agreements based on the General Agreement on Tariffs and Trade (GATT), an international accord first signed by 23 nations in 1947
- currently consists of 164 countries
- headquartered in Geneva, Switzerland
$World Bank:$ provides low-interest loans to developing nations for improving transportation, education, health, and telecommunications
- it was founded after WWII to help European countries rebuild
- it has 189 member nations, with most contributions coming from Britain, United States, Japan, and Germany
$International Monetary Fund (IMF):$ designed to assist in smoothing the flow of money between nations
- founded in 1945 and now affiliated with the UN
- operates as a last-resort leader that makes short-term loans to countries suffering from unfavorable balance of payments

the 5 major emerging countries
- Brazil, Russia, India, China, and South Africa
- coined by a financial analyst as promising markets for finance capital in the 21st century
- represent 40% of the world’s population
- represent about 20% of the world’s economic activity