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Global Finance Environment Paper

In: Business and Management

Submitted By afrank19
Words 1180
Pages 5
Global Finance Environment Paper
FIN/403
May 4, 2008

Globalization refers to the merging of national markets into one huge global marketplace. In today’s market, selling internationally is much easier due to falling barriers in cross-border trade. Now businesses don’t have to be industry giants to operate and succeed in global markets. Although it can be beneficial to offer a standard product that can be used worldwide, significant differences still exist between national markets such as cultural differences, consumer taste differences, product preferences and legal regulations. It is important to define and understand these differences when merging into national markets. Globalization is inevitable and it’s happening at an astonishing speed in nearly every market possible. The technology era that we are in has enabled businesses to join forces like never before and we are seeing significant changes in the global marketplace. There are main drivers in globalization and this paper will define three of them, as well as describe the risks associated with financial investing, and explain the importance of cultural sensitivity and ethics in global finance.

Drivers of Globalization

Market drivers Domestic markets are saturated and growth opportunities are often times limited. Expanding globally opens up many new opportunities allowing for real growth within a business. The following lists in detail the specific market drivers that play a key role in globalization;

o Convergence of per capita income o Growing global and regional channels o Global customers due to increased organizational buying o Increasing number of world brands and global advertising o Convergence of cultural beliefs, lifestyles and tastes o Transferable marketing

Cost drivers
Availability of raw materials, sourcing ability and costs...

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