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She encouraged WTO members to find a “pragmatic outcome” to a proposal by India and South Africa that vaccine and other medic al patents be suspended during the COVID -19 pandemic to speed up technology transfers to manufacturers with spare production capaci ty. Tedros said the WHO supports calls for manufacturers to remove obstacles hindering access to critical health products.

https://www.aljazeera.com/economy/2021/4/12/us -oil -output -climbs -toward -level -not -seen -since -pandemics -start The Permian Basin, the U.S.’s most prolific shale patch, will produce crude oil at levels not seen since the start of the pan dem ic in the latest sign the global economy is heating back up.

Higher prices are buoying drillers’ confidence. Benchmark Nymex oil gained nearly 35% in the past four months after OPEC and its alliance cut production to strike a balance between demand and supply.

https://www.aljazeera.com/economy/2021/4/12/us -budget -deficit -this -year -nearly -doubles -previous -record The United States government’s budget deficit surged to an all -time high of $1.7 trillion for the first six months of this budge t year, nearly double the previous record, as another round of economic -support cheques added billions of dollars to spending last month. The deficit has been driven higher by trillions of dollars in support that Congress has passed in successive economic rescue pac kages since the coronavirus pandemic struck in early March 2020. The latest round came in a $1.9 trillion measure that President Joe Bide n p ushed through Congress last month.

Biden’s package included individual support payments of up to $1,400 and the administration rushed to make those payments as soo n as Biden signed the measure into law. The Treasury statement showed that the payments in March totaled $339bn. MKT3064 International Marketing The World Economy: An Overview •In the early 20 th century economic integration was at 10 % ; today it is 50 % •EU and NAFTA are highly integrated •Global competitors have displaced or absorbed local ones https://www.weforum.org/agenda/2020/07/largest -global - economies -1992 -2008 -2024/ The World Economy: New Realities • capital movements replaced trade as the driving force of the world economy . • production uncoupled from employment • world economy, not individual countries, is the dominating factor • the end of the Cold War • E -commerce The World Economy: Capital Movements • The dollar value of world trade in goods and services was $25 trillion in 2009 . However, the Bank for International Settlements has calculated that foreign exchange transactions worth approximately $4 trillion are booked every day . This works out to more than $1 quadrillion annually, a figure that far surpasses the dollar value of world trade in goods and services .5 An inescapable conclusion resides in these data : Global capital movements far exceed the dollar volume of global trade . In other words, currency trading represents the world’s largest market . The World Economy: Production and Employment • In the US, manufacturing share of GDP declined from 19 .2% in 1989 to 13 % in 2009 . In 2011 , manufacturing employed about 9% of the workforce ; the figure was 26 percent . During that 40 -year period, productivity has increased dramatically . Similar trends can be found in many other major industrial economies as well .In the United Kingdom, for example, manufacturing’s share of jobs is only 8 percent, compared with 24 percent in 1980 .8 One recent study of 20 large economies found that between 1995 and 2002 more than 22 million factory jobs were eliminated .Manufacturing is not in decline — it is employment in manufacturing that is in decline . https://hbr.org/2015/06/the -great -decoupling The World Economy: Emergence of world economy • The real secret of economic success of Japan and Germany is that business leaders and policy makers focus on their countries’ competitive positions in world markets . This change has brought two questions to the fore : How does the global economy work, and who is in charge? Unfortunately, the answers to these questions are not clear cut . https://www.un.org/development/desa/dpad/publication/undesa -policy -brief -51 -reflecting -on -70 -years -of-development -policy -analysi s-of-world - economic -and -social -survey/ The World Economy: End of the Cold War • The struggle between capitalism and socialism began in 1917 is over . • The demise of communism as an economic and political system can be explained in a straightforward manner : Communism is not an effective economic system . The overwhelmingly superior performance of the world’s market economies has given leaders in socialist countries little choice but to renounce their ideology and introduce democratic reform . The World Economy: E -Commerce • E -Commerce diminishes the importance of national barriers and forces companies to re - evaluate business models . • The PC and the internet have, in some ways, diminished the importance of national boundaries . 2/3s of American households have PCs . There are 600 million computers used worldwide . • Finally, the personal computer revolution and the advent of the Internet era have in some ways diminished the importance of national boundaries .Worldwide, an estimated 1 billion people use personal computers . In the so -called Information Age, barriers of time and place have been subverted by a transnational cyberworld that functions “24 /7.” Amazon .com, eBay, Facebook, Google, Groupon, iTunes, Priceline, Twitter, and YouTube are just a few of the companies that are pushing the envelope in this brave new world Quiz 1 Pls click and answer:

• https://forms.office.com/Pages/ResponsePage.aspx?id=6wgQBUDbSUKezp 3z6MP1lK_wGBdd4j5HjFi0nHkGJSFUQVBSWldZNUw5WFBHR1VFNjFOUDc0 NjBGSi4u Zeroing in on Economic Systems • Globalization has made it harder to pigeonhole economies within the four - cell matrix Economic Systems: Factors • Type of economy . Is the nation an advanced industrial state, an emerging economy, a transition economy, or a developing nation? • Type of government . Is the nation ruled by a monarchy, a dictatorship, or a tyrant? Is there an autocratic, one -party system? Is the nation dominated by another state, or is it a democracy with a multiparty system? Is it an unstable or terrorist nation? • Trade and capital flows . Is the nation characterized by almost completely free trade or incomplete free trade, and is it part of a trading bloc? Is there a currency board, or are there exchange controls? Is there no trade, or does the government dominate trade possibilities? • The commanding heights (e .g ., the transportation, communications, and energy sectors) . Are these sectors state owned and operated? Is there a mix of state and private ownership? Are they all private, with or without controlled prices? Economic Systems: Factors • Services provided by the state and funded through taxes. Are pensions, health care, and education provided? Pensions and education but not health care? Do privatized systems dominate? • Institutions . Is the nation characterized by transparency, standards, the absence of corruption, and the presence of a free press and strong courts? Or is corruption a fact of life and the press dominated by the government? Are standards ignored and the court system compromised? • Markets . Does the nation have a free market system characterized by high -risk/high -reward entrepreneurial dynamism? Is it a free market that is dominated by monopolies, cartels, and concentrated industries?

Is it a socialized market with cooperation among business, government, and labor (but with little entrepreneurial support)? Or is planning, including price and wage controls, controlled by the center Economic Systems Resource Allocation Market Command Private Resource Ownership State Market Socialism Centrally Planned Capitalism Centrally Planned Socialism Market Capitalism Market Capitalism Market capitalism is practiced around the world, most notably in Western Europe and North America . All market -oriented economies do not function in an identical manner . The U .S. is characterized by its competitive “free -for -all” and decentralized initiative .Japan is sometimes called “Japan, Inc .” because it has a tightly run, highly regulated economic system that is also market oriented . • Individuals and firms allocate resources • Production resources are privately owned • Driven by consumers • Government’s role is to promote competition among firms and ensure consumer protection https://www.economicshelp.org/blog/5002/economics/pros - and -cons -of-capitalism/ Western Market Systems Centrally Planned Socialism • Opposite of market capitalism • State holds broad powers to serve the public interest; decides what goods and services are produced and in what quantities • Consumers can spend only what is available • Government owns entire industries and controls distribution • Demand typically exceeds supply • Little reliance on product differentiation, advertising, pricing strategy • China, India, and the former USSR now moving towards some market allocation and private ownership Centrally Planned Capitalism • Economic system in which command resource allocation is used extensively in an environment of private resource ownership • Example:

– Swedish government controls 2/3s of all spending; a hybrid of CPS and capitalism (Market Socialism) – Swedish government plans move towards privatization https://slideplayer.com/slide/6219836/ Economic Freedom • Rankings of economic freedom among countries – “free” “mostly free” “mostly unfree” “repressed” • Variables considered include such things as:

– Trade policy – Taxation policy – Capital flows and foreign investment – Banking policy – Wage and price controls – Property rights – Black market https://www.youtube.com/watch?v=u75DbD9JCko https://www.heritage.org/index/?version=105 Quiz 2 Pls click and answer:

• https://forms.office.com/Pages/ResponsePage.aspx?id=6wgQBUDbSUKezp 3z6MP1lK_wGBdd4j5HjFi0nHkGJSFUQkRPT01DRENYRU9YOTVURTFSQlROU 001Ry4u Stages of Market Development • The World Bank has defined four categories of development using Gross National Income (GNI) as a base • Although the income definition for each of the stages is arbitrary, countries within a given category generally have a number of characteristics in common. Thus, the stages provide a useful basis for global market segmentation and target marketing . • Big Emerging Markets (BEMs) , identified 10 years ago, were countries in Central Europe, Latin America, and Asia that were to have rapid economic growth. • Today, the focus is on BRICS: Brazil, Russia, India, China and South Africa. BRICS nations are expected to be key players in global trade even as their track records on human rights, environmental protection, and other issues are scrutinized by their trading partners. The BRICS government leaders will also come under pressure at home as their developing market economies create greater income disparity . Low -Income Countries • GNP per capita of $ 1,025 or less • Characteristics – Limited industrialization – High percentage of population in farming – High birth rates – Low literacy rates – Heavy reliance on foreign aid – Political instability and unrest – Concentrated in Sub -Saharan Africa Lower -Middle -Income Countries • GNI per capita: $1,026 to $4,035 • Characteristics – Rapidly expanding consumer markets – Cheap labor – Mature, standardized, labor - intensive industries like footwear, textiles and toys • 50 bottom -ranked countries are LDCs — least developed countries • India is the only BRIC nation Upper -Middle -Income Countries • Also called industrializing or developing economies • BRICS: Brazil, China, Russia, South Africa • Other countries: Malaysia, Chile, Venezuela, Mexico GNP per capita : $ 4 ,036 to $ 12 ,475 Characteristics : •Rapidly industrializing, less agricultural employment •Increasing urbanization •Rising wages •High literacy rates and advanced education •Lower wage costs than advanced countries Chilean copper mine Newly Industrializing Economies (NIEs) • Lower -middle and upper income economies with the highest sustained rates of economic growth – Greater industrial output that developing economies – Exports of manufactured and refined products – N -11 a new country grouping identified by Goldman Sachs • NIEs include Egypt, Indonesia, the Philippines, (lower -middle income) Mexico, and Turkey (upper -middle income) Marketing Opportunities in Least Developed Countries (LDCs) • Characterized by a shortage of goods and services • Long -term opportunities must be nurtured in these countries – Look beyond per capita GNP – Consider the LDCs collectively rather than individually – Consider first mover advantage – Set realistic deadlines Mistaken Assumptions about LDCs 1. The poor have no money. 2. The poor will not “waste” money on non - essential goods. 3. Entering developing markets is fruitless because goods there are too cheap to make a profit. 4. People in BOP (bottom of the pyramid) countries cannot use technology. 5. Global companies doing business in BOP countries will be seen as exploiting the poor. High -Income Countries • GNI per capita: $12,476 or more • Also known as advanced, developed, industrialized, or postindustrial countries • Characteristics:

– Sustained economic growth through disciplined innovation – Service sector is more than 50% of GNI – Households have high ownership levels of basic products – Importance of information processing and exchange – Ascendancy of knowledge over capital, intellectual over machine technology, scientists and professionals over engineers and semiskilled workers – Future oriented – Importance of interpersonal relationships Tokyo Quiz 3 Pls click and answer: • https://forms.office.com/Pages/ResponsePage.aspx?id=6wgQBUDbSUKezp3z6MP1lK_w GBdd4j5HjFi0nHkGJSFUNFVJVE1WU1dSWkowMlg4TUFRTDVXODVWQS4u Global Economic Groupings: G -8, the Group of Eight • G 8 was an inter -governmental political forum from 1997 until 2014 . It had formed from incorporating the country of Russia into the Group of Seven, or G 7 , and returned to its previous name after Russia was disinvited in 2014 G -20, Group of Twenty • The G20 (or Group of Twenty) is an international forum for the governments and central bank governors from 19 countries and the European Union (EU). • Established in 1999 • Finance Ministers and central bank governors of 19 countries and the EU Russia hosted the 2013 summit. OECD, the Organization for Economic Cooperation and Development • 34 nations • Post -WW II European origin • Canada, U.S. (1961), Japan (1964) • Promotes economic growth and social well -being • Focuses on world trade, global issues, labor market deregulation – Anti -bribery conventions The Triad https://www.emerald.com/insight/content/doi/10.1108/PRR -03 -2018 -046/full/html U.S., Western Europe, and Japan Represents 75% of world income Expanded Triad includes all of North America and the Pacific Rim and most of Eastern Europe Global companies should be equally strong in each part Product Saturation Levels • The % of potential buyers or households who own a product • India: 20% of people have telephones • Autos: 1 per 43,000 Chinese, 21 per 100 Poles, 49 per EU adults, 8 per 1,000 Indians, 200 out of 1,000 in Russia, 565 out of 1,000 in Germany • Computers: 1 PC per 6,000 Chinese; 11 PCs per 100 Poles; 34 PCs per 100 EU citizen https://medium.com/new -markets -insights/the -10 -reasons -people -buy -new -products -1489aad9b1c9 World’s Top Exporters and Importers https://www. visualcapitalist .com/top -importers -exporters -worlds -18-traded -goods/ https://www.statista.com/chart/18356/net -importers -and -exporters/ Balance of Payments (BOP) • Record of all economic transactions between the residents of a country and the rest of the world – Current account – record of all recurring trade in merchandise and services, and humanitarian aid • trade deficit — negative current account • trade surplus — positive current account – Capital account – record of all long -term direct investment, portfolio investment, and capital flows Balance of Payments U.S. Goods and Services Trade with Brazil, India and China Quiz 4 Pls click and answer the questions:

• https://forms.office.com/Pages/ResponsePage.aspx?id=6wgQBUDbSUKezp3z 6MP1lK_wGBdd4j5HjFi0nHkGJSFUMjZWWTZSNUFORVBMWDFKTjJON09TMVJ FWC4u International Finance • Is the study of monetary interactions that transpire between two or more countries. International finance focuses on areas such as foreign direct investment and currency exchange rates. Increased globalization has magnified the importance of international finance . • Foreign exchange makes it possible to do business across the boundary of a national currency • Currency of various countries are traded for both immediate (spot) and future (forward) delivery • Currency risk adds turbulence to global commerce Foreign Exchange Market Dynamics • Supply and Demand interaction – Country sells more goods/services than it buys – There is a greater demand for the currency – The currency will appreciate in value Managing Economic Exposure • Economic exposure refers to the impact of currency fluctuations on the present value of the company’s financial performance. • Occurs when sales are in a foreign currency – Nestlé generates 98% of sales outside home country – Euro zone companies GlaxoSmithKline, Daimler AG, BP, for example, generate 1/3 of sales in the U.S. Transnational Institutions • Refers to international organizations (usually, international nongovernmental organizations) that "transcend" the idea of a nation -state. • The distinction between an international and a transnational organization is unclear and has been criticized by some scholars (ex. Colás, 2002). • Transnational relations have been defined as “contacts, coalitions, and interactions across state boundaries that are not controlled by the central foreign policy organs of governments.” Examples of transnational entities are “multinational business enterprises and revolutionary movements; trade unions and scientific networks; international air transport cartels and communications activities in outer space. World Trade Organization (WTO) • The only international organization dealing with the global rules of trade . Its main function is to ensure that trade flows as smoothly, predictably and freely as possible. World Trade Organization (WTO) cases Preferential Trade Agreements (PTA) Preferential trade agreements : (FTAs) remove barriers to trade between members and offer preferential access to markets on a reciprocal basis. In addition to trade in goods, FTAs usually cover trade in services and investment provisions as well as remove both tariff and non -tariff barriers to trade . Types of Preferential Trade Agreements (PTA) and its hierarchy North American Free Trade Agreement (NAFTA) https://www.thebalance.com/nafta -definition -north -american -free -trade -agreement -3306147 A treaty between Canada, Mexico, and the United States that eliminated most tariffs between the countries . It was replaced by the United States -Mexico -Canada Agreement (USMCA) on July 1, 2020 Association of Southeast Asian Nations (ASEAN) https://asean.org/ An economic union comprising 10 member states in Southeast Asia, which promotes intergovernmental cooperation and facilitates economic, political, security, military, educational, and sociocultural integration among its members and other countries in Asia Quiz 5 Pls click and answer the questions below:

• https://forms.office.com/Pages/ResponsePage.aspx?id=6wg QBUDbSUKezp3z6MP1lK_wGBdd4j5HjFi0nHkGJSFUMkpOUT VFUldKMDZKWVJGQTlQRUZONU9NVy4u Marketing/Trade Issues in Japan https://www.trade.gov/knowledge -product/japan -market -challenges While tariffs are generally low, Japan does have some non -tariff barriers that may impact commercial activity by possibly impeding or delaying the importation of foreign products into Japan .Although competition, U.S. and other foreign government pressure and other factors, have lessened the impact of these impediments, U .S.companies may still encounter non -tariff barriers in the following areas : • Standards unique to Japan (formal, informal, de facto, or otherwise) ; • A requirement in some sectors or projects for companies to demonstrate prior experience in Japan, effectively shutting out new entrants in the market ; • Official regulations that favor domestically produced products and discriminate against foreign products ; • Licensing powers in the hands of industry associations with limited membership, strong market influence, and the ability to control information and operate without oversight ; • Cross stock holding and interconnection of business interests among Japanese companies that disadvantage suppliers outside the traditional business group ; • Cartels (both formal and informal) ;and • The cultural importance of personal relationships in Japan and the reluctance to break or modify business relationships. Marketing/Trade Issues in European Union (EU) https://www.trade.gov/knowledge -product/european -union -market -challenges • EU legislation generally takes two forms . “Regulations” have mandatory language and are directly applicable in Member States when implemented .“Directives” provide a general framework and must be “transposed” into national legislation at the member state level . Differences in how directives are transposed in Member States are common, which complicates compliance for U.S.companies doing business in the EU . Industry has raised concerns over perceived onerous regulations and unnecessarily high compliance costs . • The EU has legislative harmonization competence that it can choose to exercise in such areas as the free circulation of goods, services, and capital within the internal market as well as agriculture, fisheries, transport, and energy . Human health, tourism, and civil protection are examples of areas where the EU can only legislate in support of Member States’ initiatives . • While the EU continues to move in the direction of a Single Market, the reality today is that U.S. exporters continue to face barriers to entry and challenges with regulations, testing, and standards . In several industries such as pharmaceuticals, chemicals, telecommunications, legal services, and government procurement, some of these barriers are more pronounced . Marketing/Trade Issues in Middle East and North Africa (MENA) https://www.imf.org/external/pubs/ft/med/2003/eng/abed.htm • Real per capita GDP growth in the MENA region during the last 30 years stagnated compared to the rest of the developing world due to the extended weakness in the oil markets as producers outside of the MENA region gained market share at the expense of oil exporters in the region . • The region's high population growth dragged down the rate of growth of per capita GDP . • The oil -producing countries seem to have experienced what has become known as the "resource curse ."An abundance of natural resource wealth can lower growth by, among other things, generating an appreciation of the real exchange rate resulting from large oil -related foreign exchange inflows, thus making non -oil exports less competitive and shrinking the relative size of the non -oil export sector . • Islamic Republic of Iran, Kuwait, and Oman, have addressed this procyclicality by establishing oil and stabilization funds (OSF) that save part of the oil receipts abroad, in effect, sterilizing foreign exchange inflows . Other oil -producing countries in the region have chosen not to establish formal OSFs with precommitted fiscal rules, but have tended to conduct fiscal management with a "virtual" OSF that, in effect, invests the excess oil receipts abroad . Looking Ahead Lecture 3 • Social and Cultural Environments