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Global Business Management: Issues in China

- Research the country (China)

- Identify the ultimate monetary authority in China (comparable to the Federal Reserve in the U.S., the Bank of England in the UK, etc.).

- identify the key monetary aggregates and interest rates that affect economic performance in China.

- Evaluate how the key monetary aggregates and interest rates in China might have an impact upon an American organization of which you are a board leader in its plans to function in that country.

-Does the growth in the monetary aggregates suggest that general prices will be rising more or less rapidly?

-Are changes in interest rates favorable or unfavorable to your organization's business purpose in that nation?

-Based on the country you choose where your company plans future Endeavor (China) are there other neighboring nations where your American entity already has experience which are key trading countries for your company, within the same region,

Finally if your company was to move into this new, additional, global location ( to distribute its products or services to a new pool of targeted customers in those countries) , what exchange rate and trade policies (quotas and tariffs) has your research established are in effect?

Quotas or tariffs which might either prove positive or negative to your purpose â?¦might facilitate or your plan to export your products or services?

over 1,000 words, four references

Solution Preview

First of all, according to Usunier & Lee (2005) in recent years, the People's Republic of China has become much more open to trade with the west, and has also made substantial internal economic reforms; companies in Japan, the western European countries, the US, have viewed the Chinese market as having enormous potential; with a population of a billion and a growing economy, it has appeared to many to be worthwhile to make a major effort to gain a foothold in the Chinese market; both direct exports and joint ventures have been used. My company, Sanford Medical System has decided to outsource its medical transcription operations into China, where the cost of labor will be much cheaper than that in the United States. However, according to Usunier & Lee (2005) all contracts for trade must receive several government approvals; large contracts receive more approvals than small ones; it is not always apparent to the outsider, or perhaps even to some of the Chinese, what specific approvals will be required in particular cases; while letters of credit may be issued to companies exporting to China, these do not provide the same level of assurance that a letter of credit issued by, say, a London bank would. According to these authors, the Chinese bank will simply not release foreign exchange, regardless of the existence of a letter of credit, without the approval of appropriate government agencies; foreign companies selling to the government may not receive a letter of credit, but may feel that they can rely on the good faith of the government. Other countries nearby, in which Sanford Health may consider doing business in, in terms of outsourcing its medical operations may include India or even Indonesia.

According to the CIA World Factbook (2010) China's economy over the past 30 years has changed from a centrally planned system that was largely closed to international trade to a more market-oriented economy that has a rapidly growing private sector and is a major player in the global economy. According to this site, reforms began in the late 1970s with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, the foundation of a diversified banking system, the development of stock markets, the ...

Solution Summary

Global business management issues in China are examined.