globalEDGE Blog Archive January 2011

It’s time for another blog series at globalEDGE! This week we’re going to be talking about microfinance; but before we get into this topic further, I’d like to give a little background on what exactly microfinance is.

It is a country already considered one of the biggest maritime arms smugglers, in addition to being accused of letting its military charge “protection fees”, akin to those of mobs, to companies operating within its borders. However, Yemen has devised a strategy for raising money that can be considered either ingenious or moronic. Already faced with corruption through the majority of military branches, it has decided to use its military for a more economic and productive purpose.

In a survey on globalization conducted by Ernst & Young, the majority of companies responded that diversity of gender, ethnicity, and experience are important components of a successful management team.  These respondents stated that financial performance and overall reputation would be improved by incorporating diversity throughout an organization.  Despite their own advice, many upper management teams are composed exclusively of people from one country.  In order to capitalize on opportunities in emerging markets, it seems beneficial to have managers with first-hand knowledge of business around the world. 

During the cold winter months, businesses use an enormous amount of energy to heat their working facilities. With soaring energy prices around the globe, businesses are looking for ways to save energy to reduce these high energy costs. A company in Sweden has found an exceptional way to do just this. Sweden’s creative approach to heating might just surprise you.

There has been much hype recently about rising inflation rates around the globe. The euro zone had an inflation rate of 2.2% in 2010, while China's rose 5.1% from November 2009 to November 2010. Many people fear that a surge in inflation could have an adverse effect on the recovery efforts of many economies. But what exactly is inflation and how does it affect an economy?

Although hiring of MBA graduates has suffered during the recent recession, it appears that the tides of good fortune are returning.  As consulting firms, investment banks and other top employers commit to aggressive hiring targets, many graduates are gaining  confidence in their ability to land an ideal position.  While some of this wave may be attributable to an improving economy, innovative new outreach programs are also finding desirable jobs where they have never been found before. 

After the official unpegging of the Renminbi (Also referred to as the yuan) to the dollar mid-way through last year, China has surprisingly started to increase the flexibility of the Renminbi and is actively encouraging the globalization of the currency.  Much of this change has come for two reasons. The first is as China has become the world’s second largest domestic economy, the need for a globalized currency becomes exponentially more important. Also, international pressures on the Renminbi and China, especially from the U.S., have started to force change.

Are you or your boss scared of starting to export products internationally? Are you afraid of dealing with culture barriers (especially in client meetings)? Do you want to expand your business globally to reach the 95% of consumers who live outside the U.S., but are just not sure how? If these questions sound pertinent to your business, then the U.S. Commercial Service is here to help you.

A global recession did very little to slow down the demand for one of life’s more entertaining sins: gambling. The only difference now is how they’re doing it and where they’re doing it. Macau, China has been flexing its increasing dominance in the gambling industry and local and state governments are increasingly pushing to legalize gambling as a way to increase tax revenues. Some states are even using mobile computing to allow gambling on the go!

Bad weather can have devastating effects on a business. In the last year we saw massive floods, earthquakes, and snowstorms. Such events caused disruptions in transportation and infrastructure, which in turn created obstructions for workers and the end result was that global businesses incurred large costs.

It is easy to see why many companies - especially in the logistics business, invest heavily in weather forecasting. Different types of weather technology help businesses manage risk imposed by natural disasters. The following BBC video provides examples of how technology is used to aid businesses:

In Kabul, Afghanistan the United States established the new American Chamber and named Dom LaVigne as its first executive director this past November. Dom LaVigne, former executive director of the American Chambers of Commerce in Singapore and Malaysia, recently sat down with International Trade Specialist Doug Barry to discuss the many opportunities for business in Kabul.

Incoterms are standards for international trade that provide a consistent interpretation of agreements included in global business contracts.  Every ten years, the International Chamber of Commerce makes updates to the standards based on changes in the global business environment.  As of January 1, 2011, the new Incoterms 2010 are officially in effect.  The revisions listed below are a reflection of widespread changes in international business markets over the past decade. 

With China being one of Brazil’s most important trading partners, the two have created a whole lot of business and money-making opportunities for both countries. No person knows this more than Eike Batista, a Brazilian minerals tycoon that is now the eighth richest man in the world, with a wealth of $27 billion. He’s gotten there quickly, thanks in large part to China.

The Wall Street Journal had a very interesting piece for their “The Saturday Essay” this past week. It reflected on the cultural differences in parenting styles; written from the perspective of Amy Chua – a Chinese mother who is also a professor at Yale Law School. While it is written to contrast mostly American parents, I believe (and so does the author) that the article can be viewed from a completely global perspective.

A recent article from The Economist describes the renewed emphasis that global businesses have put on hiring the best and brightest recruits.  Business leaders support the “Pareto” philosophy that a very slim portion of the world’s workforce is responsible for the vast majority of actual progress.  One influential corporate leader can have more impact on a company’s direction than an entire department of lower-level employees.  For this reason, companies such as General Electric (GE) and Procter and Gamble (P&G) have invested disproportionate resources toward finding and keeping “the vital few.”  In today’s global economy, an important aspect of developing such prominent leaders includes exposure to international knowledge and opportunities. 

Learn how your company can tap into the Global Marketplace! This year the Commerce Department’s Trade Information Center is offering a series of one-hour webinars on the basics of exporting. These webinars have been especially designed to meet the needs of new exporters. There is no fee to participate, although registration is required. Content will include slides, live audio, and question-and-answer sessions.

Family or career? This has been a tough choice for many. The Dutch might have the answer. Daddy days and job-sharing as well as part-time employment have become quite typical in the Netherlands. Because of these irregular work hours, many companies do not even have assigned cubicles for their employees. Some examples are Microsoft and the Economics Ministry. Both have moved to what is known as "flex-buildings" which are smaller offices with less work stations than employees.

In a recent Wall Street Journal article the idea of more and more students taking off a year before college was raised. These students would instead travel, volunteer internationally, and even study fields they are interested in pursuing. After seeing the increase of those engaging in the "gap year" as they call it, it further begs the question "why"?

‘China is on the rise’ is a statement that we hear all too often. However, China’s growth does not only appear to be benefiting China alone. Vietnam has been able to use this neighboring country’s growth to benefit its own economy. Vietnam has a lot of appeal for international business and has begun to make a name for itself through China's success.