Outward FDI from developing countries : a case of Chinese firms in South Africa

Outward foreign direct investment (FDI) from developing countries is increasing. In the research on FDI, it has been considered that only competitive and productive firms can invest in foreign countries. However, since the differences in competitiveness and productivity between multinational enterprises (MNEs) from developed and developing countries have not been explicitly investigated, we cannot say whether MNEs from developing countries can or cannot survive in competition with MNEs from developed countries as well as against competitive and productive indigenous firms in host countries. To examine the activities of MNEs from developing countries, this study investigates Chinese firms in South Africa. It reveals that in order to compensate for the weak brand recognition of Chinese products and to expand sales, Chinese firms have mainly been making products that are sold under the brand names of indigenous South African firms. Chinese firms have expanded their business in South Africa relying on the business resources of indigenous firms in the host country. This indicates that business with indigenous firms is significant for MNEs from developing countries in boosting competitiveness.

Food safety control system of Chinese eel exports and its challenges

This paper analyzes factors associated with the rejection of products at ports of importer countries and remedial actions taken by producers in China. As an example, it uses one of the most competitive agro-food products of China: live and processed eels. This paper provides an overview of eel production and trade trends in China. In addition, it identifies the causes of port rejection of Chinese eel products as veterinary drug residues by examining the detailed case studies of export firms and the countermeasures taken by the government and firms.

Two-polar growth strategy in Myanmar : seeking "high" and "balanced" development

The Thein Sein government of Myanmar seeks higher and balanced economic growth. This is a challenge for the government since some economic literature identifies a trade-off between higher economic growth and better regional equality, especially for countries in the early stages of development. In this paper, we propose a two-polar growth strategy as one that includes both "high" and "balanced" growth. The first growth pole is Yangon, and the second is Mandalay. Nay Pyi Taw, the national capital, will develop as an administrative centre, not as an economic or commercial one. We also propose border development with enhanced connectivity with richer neighboring countries as a complementary strategy to the two growth poles. Effects of the two-polar growth strategy with border development are tested using a Geographical Simulation Model (GSM).

Response of local producers to agro-food port rejection : the case of Chinese vegetable exports

This paper analyzes the factors associated with the rejection of products at ports of importer countries and remedial actions taken by producers in China by taking as an example one of the most competitive agro-food products of China: frozen vegetables. This paper provides an overview of the vegetable production and distribution system in China and the way in which China has been participating in exports of these products. Later sections will examine in detail the frozen vegetable sector in China, identify the causes of port rejections, and the actions taken by the Chinese government and by producers, processors and exporters to improve the quality of frozen vegetable exports.

FDI and investment barriers in developing economies

Does investment liberalization in developing economies affect FDI decisions differently across individual firms? To address this question, we simulate the response of individual firms to reductions in investment costs across developing economies. We explore two policy experiments: elimination of setup-procedure requirements for foreign investors and a reduction in corporate tax rates on foreign-owned multinationals. We find that a relaxing of discriminatory foreign investment procedures induces middle productive firms to increase their entry and production in developing economies substantially, but the most productive firms to expand moderately. Multinationals expand their entry and production in developing economies more substantially following a decline in entry barriers than following a decrease in corporate tax rates.

Assessment of FDI impact on Thailand's production sectors : implications for investment promotion activities

This paper examines the overall and sectoral economic impact of foreign direct investment (FDI) on the Thai economy using the economic data from 2005-2013. In assessing the overall economic impact, it is found that FDI has contributed positively to Thailand's economic growth. However, when analyzing the sectoral details, the empirical results indicate that FDI has a varying impact on the productive sectors in Thailand. Out of the 9 sub-sectors covered by this study, 5 sub-sectors (manufacturing, construction, financial, wholesale, retail trade, and agriculture) show strong statistically-significant positive effects of FDI on the relevant sector's value-added output. Based on these findings, it is suggested that policy-makers, including the Board of Investment, should aim to promote FDI with special consideration of the sectoral impact that would enable Thailand's FDI promotion policies to be more productive and beneficial for the Thai economy.

FDI inflows and outflows, intellectual property rights, and productivity growth

Using panel data of 57 countries during the period of 1995-2012, this study investigates the impact of intellectual property rights (IPR) processes on productivity growth. The IPR processes are decomposed into three stages, innovation process, commercialization process, and IPR protection process. Our results suggest that better IPR protection is directly associated with productivity improvement only in developed economies. In addition, the contribution of IPR processes on growth through foreign direct investment (FDI) appears to be very limited. Only FDI inflows in developed countries which help to create a better innovative capability lead to a higher growth. And in connection with FDI outflows, only IPR protection and commercialization processes are proven to improve productivity in the case of developing countries, particularly when the country acts as the investing country.

Firm-level impacts of natural disasters on production networks : evidence from a flood in Thailand

In this paper, we explore the firm-level impacts of flooding in Thailand in 2011, specifically those on the procurement patterns at Japanese affiliates in Thailand. Our findings are as follow. First, the damaged small firms are more likely to lower their local procurement share, particularly the share of procurement from other Japanese-owned firms in Thailand. Second, damaged young firms and damaged old firms are more likely to raise the shares of imports from Japan and China, respectively. Third, there are no impacts on imports from ASEAN and other countries. These findings are useful for uncovering how multinational firms adjust their production networks before and after natural disasters.

Did Japanese direct investment in Korea suppress indigenous industrialization in the 1930s? : evidence from country-level factory entry patterns

Foreign direct investment (FDI) can deliver both positive and negative spillovers to the local economy. Negative effects such as crowding-out or entry-barrier effects might outweigh the positive ones when the technological gap between foreign and local firms is significant. This paper examines the impact of Japanese direct investment into Korea under colonization in the 1930s on the entry of Korean-owned factories. By using the census of manufacturing factories in Korea, we exploit variations in the share of Japanese factories and their entry rates across counties within the same subsectors. We find that within a subsector, entry rates of Korean factories were higher in counties with higher presence and entry of Japanese factories. Positive correlations are also found between subsectors. The results imply that Japanese direct investment did not suppress the entry of Korean factories and that FDI could exert positive entry spillovers on indigenous firms, even at a very early stage of industrialization.

Competition between firms in developing and developed countries

We analyze competition in emerging markets between firms in developing and developed countries from the viewpoint of the boundaries of the firm. Although indigenous firms generally face a disadvantage in technology compared with foreign firms, they have an advantage in marketing as local firms. Moreover, they have opportunities to leave weaker fields to independent specialized firms and use lower wages. On the other hand, foreign firms also have their own advantages and disadvantages for growth. Therefore, entry conditions for indigenous firms can vary greatly depending on the situation. We classify these conditions into eight cases by developing a model and showing each boundary choice for indigenous firms.

Theory and empirics of Markusen type multinationals

Research on multinational firms’ activity has been conducted widely since late 1980s. The literature is differentiated into three types: horizontal FDI, vertical FDI, and three-country FDI, represented by export platform FDI. There are other methods of differentiation of the literature by approach, for example, the pure theory approach represented by Krugman and Melitz and the numerical simulation approach represented by Markusen. This paper surveys Markusen type literature by firm type. There is little literature focused on intermediate goods trade, although intermediate goods trade is considered to be strongly related to the production patterns of MNEs. In this paper, we introduce a model to explicitly treat intermediate goods trade and present simulation analysis for empirical estimation.

Is FTA/EPA effective for a developing country to attract FDI? : simulation analysis based on an extended knowledge-capital model

To prepare an answer to the question of how a developing country can attract FDI, this paper explored the factors and policies that may help bring FDI into a developing country by utilizing an extended version of the knowledge-capital model. With a special focus on the effects of FTAs/EPAs between market countries and developing countries, simulations with the model revealed the following: (1) Although FTA/EPA generally ends to increase FDI to a developing country, the possibility of improving welfare through increased demand for skilled and unskilled labor becomes higher as the size of the country declines; (2) Because the additional implementation of cost-saving policies to reduce firm-type/trade-link specific fixed costs ends to depreciate the price of skilled labor by saving its input, a developing country, which is extremely scarce in skilled labor, is better off avoiding the additional option; (3) If a country hopes to enjoy larger welfare gains with EPA, efforts to increase skilled labor in the country, such as investing in education, may be beneficial.

The impact of foreign firms on industrial productivity : evidence from Japan

With a newly constructed dataset on foreign firms in Japan for the period 1995-2008 from firm-level surveys, this paper estimates the impact of foreign firms on industrial productivity at the regional level. A Bayesian-model averaging approach is taken to account for model uncertainty resulting from various linkages between foreign firms and domestic industries. The results show that the foreign firms may contribute to industrial efficiency directly through their above-average productivity and indirectly through positive spillovers in intra-industry and local backward linkages. Forward linkages with foreign firms may have a negative impact on industrial productivity. However, these impacts depend on the nationality and entry mode of foreign investors. Aggregating foreign firms may mask their distinctive impacts on productivity.

Balanced scorecard to improve strategic management control at School of Mines and Energy, Universidad Politécnica de Madrid

We studied the situation in Spanish public universities regarding the use of the Balanced Scorecard (BSC), as an instrument of control and strategic management. Also, we studied its application to the School of Mines and Energy at Universidad Politécnica de Madrid. The main advantage of the BSC is that improves the organizational structure of the workplace and the achievement of the objectives that ensure long-term success. First we review the strategy for success used in the Spanish educational system and specifically in the Spanish public universities. Then using the BSC and applying the main strategic lines for the successful management of the School of Mines and Energy at Universidad Politécnica de Madrid. The strategic lines affect all the college groups and the success of the BSC tool is to increase communication between the faculties, personal auxiliary, students and society in general that make up the university. First we performed a SWOT analysis (DAFO in Spanish) there are proposed different perspectives that focus the long-term strategic objectives. The BSC is designed based on the strategic objectives that set the direction through using indicators and initiatives, the goals are achieved up to the programmed schedule. In the perspective of teaching, objectives are set to update facilities and increase partnerships with other universities and businesses, encouraging ongoing training of staff and improved coordination and internal communication. The internal process perspective aims at improving the marketing, the promotion of the international dimension of the school through strategic alliances, better mobility for students and professors and improved teaching and research quality results. It continues with improving the image of the school between customer?s perspective, the quality perceived by students and the loyalty of the teaching staff by retaining talent. Finally, the financial perspective which should contain costs without harming the quality, improving the employability of students and achieve relevant jobs at teaching and research through international measurement standards.

Toward a planning model for the peruvian university system as a competitive strategy.

University education in Peru is based on models of teacher-centered teaching and a conception of knowledge which is closed and static and under the dominance of an information model now overwhelmed by multiple factors hastened by international change. The worlds most prestigious universities have chosen cultural diversity as a sign of quality and are hence interested in the mobility of teachers and students through exchange and cooperation with foreign educational institutions. These universities respond more effectively to pressure from the international business sector, better satisfy training demands, introduce new information and communication technologies into education and research and have improved administration and management structures. While there is progress, the university system in Peru is a planning model defined "as a discipline that seeks to respond to the needs of an organization defined by new cultural and social models" (A. Cazorla, et al 2007).This paper studies the non-Euclidean thinking of planning and development of John Friedmann (2001). Based on the four domains of social practice, it proposes a planning model for Peruvian universities that meets international requirements.