What is the safe business environment in international trade?
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business is defined as business transactions that take place across national borders. This broad definition includes the very small firm that exports (or imports) a small quantity to only one country, as well as the very large global firm with integrated operations and strategic alliances around the world. Within this broad array, distinctions are often made among different types of international firms, and these distinctions are helpful in understanding a firm's strategy, organization, and functional decisions (for example, its financial, administrative, marketing, human resource, or operations decisions). One distinction that can be helpful is the distinction between multidomestic operations, with independent subsidiaries that act essentially as domestic firms, and global operations, with integrated subsidiaries that are closely related and interconnected. These may be thought of as the two ends of a continuum, with many possibilities in between. Firms are unlikely to be at one end of the continuum, though, as they often combine aspects of multi-domestic operations with aspects of global operations.
International business grew over the last half of the twentieth century and the early twenty-first century partly because of liberalization of both trade and investment, and partly because doing business internationally had become easier. In terms of liberalization, the General Agreement on Tariffs and Trade (GATT) negotiation rounds resulted in trade liberalization, and this was continued with the formation of the World Trade Organization (WTO) in 1995, which is responsible for the regulation of trade on the global level. Other regional trade agreements include the North Atlantic Free Trade Agreement (NAFTA) between The United States, Canada and Mexico and the MERCOSUR between South American Countries. At the same time, most governments liberalized worldwide capital movements, particularly with the advent of electronic funds transfers. In addition, the introduction of a new European monetary unit, the euro, into circulation in January 2002 has impacted international business economically. The euro is the currency of the European Union, and it has replaced the national currency of many European countries. As of early 2005, the United States dollar continues to struggle against the euro and the impacts are being felt across industries worldwide.
International business grew over the last half of the twentieth century and the early twenty-first century partly because of liberalization of both trade and investment, and partly because doing business internationally had become easier. In terms of liberalization, the General Agreement on Tariffs and Trade (GATT) negotiation rounds resulted in trade liberalization, and this was continued with the formation of the World Trade Organization (WTO) in 1995, which is responsible for the regulation of trade on the global level. Other regional trade agreements include the North Atlantic Free Trade Agreement (NAFTA) between The United States, Canada and Mexico and the MERCOSUR between South American Countries. At the same time, most governments liberalized worldwide capital movements, particularly with the advent of electronic funds transfers. In addition, the introduction of a new European monetary unit, the euro, into circulation in January 2002 has impacted international business economically. The euro is the currency of the European Union, and it has replaced the national currency of many European countries. As of early 2005, the United States dollar continues to struggle against the euro and the impacts are being felt across industries worldwide.
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