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By Atty. Josh Carol T. Ventura While globalization has created a world in which virtually no country (even N. Korea)
is truly isolated from the trade of foreign goods, there are still some types of goods
Introduction to International Business Transactions that we try not to trade or create an expanded market for (drugs, weapons, etc.)
A) Definition of International Business Transactions and Globalization D) Two core aspects of economic globalization
When one looks at economic globalization one can distinguish two core
International business consists of transactions that are devised and carried out aspects : market globalization and regulatory globalization Market globalization
across national borders to satisfy the objectives of individuals and organizations. focuses on the increased volume of transactions in which goods, services, labor and
capital cross national boundaries, facilitated both by technological change and
One of the most common definitions of globalization is the elimination of time and decreasing tariff and non-tariff barriers, such that these transactions taken as a
space as a factor in human social relations. We may then say that globalization whole begin to resemble those of a single market spanning the globe. This
involves the elimination of time and space as factors in international economic characterization of globalization begins with the fact that there has always been
relations, specifically in international business transactions. transboundary economic activity, and argues that such activity is increasing both in
scope and scale such as to warrant a new name : globalization . Thus market
B) What makes international business international?Features of International globalization asserts in essence that globalization is a quantitative rather than a
Business Transactions qualitative change.
Cross border participation
Foreign currency This common approach to defining economic globalization, however,
Different laws applied across borders represents only one aspect of economic globalization. Another definition, which shall
Transfer of goods/services across borders be termed regulatory globalization, includes the quantitiative changes highlighted
Basically, any flow of value across borders. in market globalization, but emphasizes a qualitative change in the nature of our
regulation of markets. In particular, regulatory globalization focuses on the complex
***Foreign Exchange social processes which have led to the regulation of markets for goods, labor, capital
and services at new levels, levels which require formalized interstate cooperation
Chief concern here is foreign currency--money and finance through new and powerful institutions like the WTO, and which may in certain cases,
90% of all currency transactions are against the U.S. dollar transcend nation-state control to a significant degree, as in the case of the European
U.S. dollar is the most common reserve currency. Union.
Two important features of U.S. dollar as reserve currency are:
(1) convertability and (2) stability (inflation controlled) E.)The Primary Types of International Business Activities Are:
a) Sale of Goods (Exporting and Importing)
Foreign exchange market is unique in its efficiency. b) Sale of Services (consultancy)
Currency risks in international business transactions include varying rates, c) Licensing and Technology Transfer
inflation, instability, etc. d) Foreign Direct Investment
J) Global investment forces companies to reconsider and play by new rules in:
Business practices
Legal requirements
Ethics
N)Globalization
The watchword that describes the need for companies and their employees, if they
are to prosper, to treat the world as their stage.