Trends in Global Business

1. Trends in Global Business

2. Trends in Global Business • Globalization • Internationalization of U.S. Markets and Businesses PewResearch Opinion Poll • Decreasing Economic Dominance of the U.S.?

3. Trends in Global Business Forces Driving Global Integration: • Regional Trade Agreements • More Countries Embracing a Free Market Economy • Political Changes towards Democracy • Homogenous Consumer • Telecommunication Technology • Global Competition

4. Trends in Global Business Forces Restraining Global Integration: • Less Countries Embracing a Free Market Economy • Political Changes away from Democracy • Ethnocentric Attitude • Terrorism • Fear and Populism • Economic Turmoil

5. Trends in Global Business • Growth of Prospering Regional Trade Areas EU, NAFTA • Disappointment of Regional Trade Areas ASEAN, MERCOSUR • Move toward free market system by countries in Asia and Eastern Europe • Increasing Skepticism about free markets Capitalism’s Waning Popularity • New Tendencies of Protectionism

6. Trends in Global Business • Decreasing Power of WTO • Populism in Latin America • Large Emerging Markets such as China, Russia. India, and Brazil • China’s Leadership and Capitalism What Do Chinese and Japanese Think about Each Other? • Russia’s Oil Wealth, Dutch Disease, and Crumbling Democracy • India’s two worlds

7. Trends in Global Business • Increasing Divide Between Rich and Poor Gini Index: https://www.cia.gov/library/publications/the-world-factbook/rankorder/2172rank.html Are the Top 1% getting richer?

8. r ˃ g (r = rate of return on capital and g = rate of growth of economy) „When the rate of return on capital significantly exceeds the growth rate of the economy (as it did through much of history until the nineteenth century and as is likely to be the case again in the twenty-first century), then it logically follows that inherited wealth growth faster than output and income“ Piketty, Thomas (2014), Capital in the twentyfirst Century, p. 26, Cambridge: the Bellnap Press of Harvard University. The Importance of Inheritance (France)

9. Trends in Global Business • Aging Population in most Developed Countries and China • Aching Health Care and Retirement Systems Aching Health Care System: U.S. Perspective Why is the US health spending so high? • Evolving Global Middle Income Households • E-Commerce • Increasing ideological divide between Islamic and Western countries

10. Economic Systems Western Perspective FreeRepressed - Capitalism - Communism • Private Property - State owned • Market Responsible - Government Responsible For Allocation of For Allocation of Resources Resources

11. Economic Systems Western Perspective FreeRepressed - Democracy - Theocracy • Private Property - Mixed • Market Responsible - Market, Government and For Allocation of Religious Leaders Responsible Resources For Allocation of Resources

12. Trends in Global Business • Offshore Outsourcing of highly skilled labor • Capital Movements ($ 400billion/day) exceed Trade ($15 billion/day) • Deflationary Forces Driven by New Market Economies • Low Real Interest Rates due to Global Saving Glut • Large Trade Imbalances

13. Trends in Global Business • Increasing Tensions in the EU Diverging Competitiveness of Countries (North-South divide) Unsustainable Debt in Southern Countries Investors loose confidence, flight of capital, Questionable Rescue Funds and Eroding Trust in Euro

14. Trends in Global Business Global Financial Crisis and Recession Deleveraging Quantitative Easing Gouvernement Bailouts Deflation or Inflation? Dollar Crisis or Euro Crisis? End of Paper Money? Default of Governments? Psychological and Political Consequences: • End of Deregulation? • Is the Paradigm of Free Markets Loosing its Dominance? • End of Globalization?

15. Trends in Global Business Perspective of the National Intelligence Council: Global Trends 2030 http://www.dni.gov/index.php/about/organization/national-intelligence-council-global-trends