Module 1 Foundations of International Business in Asia Pacific
Module 1 Foundations of International Business in Asia Pacific
Module 1 Foundations of International Business in Asia Pacific
12
2. Asia and Pacific: major trends
3. International environment
• De-globalization trend in the West
• Populist and nationalism emerged in the early 2000s
• Rivalry between China and the US, leads to the ‘re-shoring’ trend of supply chain
• Increasingly suspicious of regional domination and control of the South China Sea by China
• regional insecurity due to political conflicts
• The Korean Peninsula
• Mainland China and Taiwan
• Ownership of the Spratly Islands in the South China Sea
• Conflicts due to great variation across the region lead to economic, social, and political
security needs
• Environmental degradation, population growth, ethnic of religious conficts, human rights violations,
income inequalities, gender issues and migration
2. Asia and Pacific: major trends
4. Technological Competition
• Economic transformation around the world
• From a traditional, production-based to knowledge-based
• “Techno-nationalism” Technology and innovation becomes new drivers of international business
• New products are developed by latest innovation in technology across the world
• Online shopping and e-commerce, replacing traditional domestic retail
• In Asia
• Region’s technological leaders
• R&D investment: Japan 4.6%, South Korea 3.5%, Taiwan, 3.4%
• China: 5G, AI, electric vehicles, surveillance technology
• Intense rivalry leads to significant investment in research and techonology by both China and US
• US has blacklisted many Chinese firms, Americans firms are prohibited to do business with Chinese
• Many Asian firms are fear of offending either economic gian
2. Asia and Pacific: major trends
5. Pandemic
• Paralyzed world economy
• Impact has been mixed
• Booming demand for technologies equipment to move
business and social lives into virtual space
• Worldwide shortage and rising prices of
semiconductor chips
• ¾ demands served by Taiwan, South Korea, and China
• Global supply chain: highly dependent on China
• Pharmaceurticals and personal protective equipment
• Needs to rethink this model
• Much future uncertainty in the region Fig. Share of global manufacturing output in 2018
Souce: World Bank
3. The international business imperative