AIBS

Amity International Business

School
MBA, Semester 2

International Strategic Marketing

Shalini Gautam
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 AIBS

Degrees of Economic
Cooperation

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 Free Trade Area AIBS

• Group of countries that abolish all tariff

and non-tariff barriers among themselves
• Free to maintain their own tariffs and non-
tariff barriers with non member countries
• Example-NAFTA

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 Customs Union AIBS

• Countries not only eliminate barriers to

trade among them but also form a
common external trade policy for non-
members
• Example- Central American Common
Market

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 Common Market AIBS

• All restrictions on cross border investment,

movement of labor, technology transfer,
management and sharing of capital
resources are eliminated

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 Economic Union AIBS

• The member countries in an economic

union maintain a fiscal discipline, stability
in exchange rates & interest rates by way
of unified monetary and fiscal policy
• Gradually, a single currency was evolved
• Example - European Union

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AIBS

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 AIBS

Types of Companies

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 Global Company AIBS

• Centralizes key functions – including

marketing and finance.
• Headquarters produces the new
technology and disseminates it to
subsidiaries.
• Cost advantages are achieved through
economies of scale and global-scale
operations.
• Example-Kao & NEC of Japan
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 Multinational Company AIBS

(MNC)
• Investment in other countries, but do not
have coordinated product offerings in each
country.
• More focused on adapting their products
and service to each individual local
market.
• Local subsidiaries managed by nationals
• R&D & manufacturing in several countries
• Examples- P&G, Unilever
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 International Company AIBS

• Importers & Exporters having no investment

outside resident country.
• Products and technologies are developed for the
home market, extended to other countries with
similar market characteristics, then diffused
elsewhere, and the developmental sequence is
decided on the basis of managing the product
lifecycle as efficiently and flexibility as possible

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 Transnational Company AIBS

• The TRANSNATIONAL company evolved in the 1980s in

response to environmental forces and simultaneous
demands for global efficiency, national responsiveness,
and worldwide learning.
• The transnational model combines features of
multinational, global, and international models.
• A product is designed to be globally competitive, and is
differentiated and adapted by local subsidiaries to meet
local market demands.

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