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Buss 441: International Business Question Paper
Buss 441: International Business
Course:International Business
Institution: Kenya Methodist University question papers
Exam Year:2008
KENYA METHODIST UNIVERSITY
END OF SECOND TRIMESTER 2008 EXAMINATIONS
FACULTY : BUSINESS AND MANAGEMENT STUDIES
DEPARTEMENT : BUSINESS ADMINISTRATION
COURSE CODE : BUSS 441
COURSE TITLE : INTERNATIONAL BUSINESS
TIME : 2 HOURS
INSTRUCTIONS:
• Answer Question ONE (Compulsory) and any other TWO Questions
Question 1
CASE STUDY
INTERNATIONAL BUSINESS OPPORTUNITIES IN SOUTHERN SUDAN
Southern Sudan government has agreed to observe peace with the Sudanese government in Khartoum under comprehensive peace agreement signed in Kenya in 2002. The Kenya government mediated during negotiations and spent a lot of resources to see that negotiations succeed. The government has brought tranquility and has enabled the govt in Juba to plan for economic development.
Southern Sudan is endowed by nature to have a tropical climate and therefore can grow all kinds of tropical agricultural goods for commercial purposes and for domestic consumption. The government of southern Sudan is currently making long term strategic plans for developing the country and the infrastructure. Already, commercial services and hospitality industries have started developing their facilities in Juba. Yei, Rumbek, Torit, Kopeta and Kongor.
Southern Sudan in 2005 organized a two day sensitization seminar in Nairobi and invited the business community within Africa region to go to Sudan and take business opportunities available there. The government disclosed that it would give various incentives that can attract investors into the country. These can include going into joint ventures arrangements with private investors to provide basic infrastructure services required to speed up economic and social development in Southern Sudan.
Some firms have already moved to set up bases in towns across southern Sudan and these include firms from Kenya, Uganda, Tanzania and the Republic of South Africa. Some of these firms include those in banking, Manufacturing, transport, building and construction and telecommunication firms. These firms will soon enjoy first mover advantage in competition. There has been noticeable movement of personnel from volunteers, adventures, or investors looking for business opportunities. According to Kenya’s ambassador to Sudan in 2006, Colonel Elijah Mativo, Kenya may have helped the Sudan to attain peace but might loose out in business. Other far off countries like South Africa, and runaway business from Zimbabwe as well as business from neighbouring Uganda and Tanzania.
There are many opportunities in Agriculture, mining oil trade and distribution of manufactured products. In Early 2007, it was estimated that there were approximately 40,000 Kenyans working in Southern Sudan as traders, teachers, soldiers in African Union forces, NGO officials, and UN institutions workers. Because of f the anticipated increase of Kenyans in Southern Sudan and increased business activities between the two countries, Kenya has opened a consulate in Juba. Organizations have already begun soliciting for people willing to work in Southern Sudan. There is hope that if peace is maintained, Southern Sudan can prosper quickly and can join the rest of the countries of southern and Eastern Africa in development.
Using the above information, answer the following questions:
(a) Conduct a Political Risk Analysis (PRA) of Southern Sudan and advice the Kenyan firms and businessmen intending to go there. (10 marks)
(b) Apart from the political situation, what other areas would you advice an international business executive to consider before going to Southern Sudan. (8 marks)
(c) What are some of the challenges and problems the business people are likely to face in Southern Sudan? (7 marks)
Question 2
When planning to go abroad, an international Marketer must make FIVE major decisions. Critically discuss these decisions, outlining the challenges in each decision. Use appropriate examples (15 marks)
Question 3
(a) Define the term Exchange Rate and outline the three main exchange rate systems adopted by various countries. Which system does the Kenyan government use? (8 marks)
(b) International business has been appreciated by scholars and academicians as a field of study. Describe three reasons to justify this. (3 marks)
(c) Explain the main factors that influence the choice of trading partners by countries
(5 marks)
Question 4
(a) Distinguish between Ethnocentric and Polycentric Human Resource Management policies used by Multinational Corporations, clearly outlining the advantages and disadvantages of each (8 marks)
(b) MNet, a local textile company with operations in Kenya wants to go international. However, the company is likely to face various restrictions from the host countries. Discuss the reasons behind such restrictions and barriers by the Host country
(7 marks)
Question 5
(a) With reference to the East African Community Customs Union, discuss the benefits Kenya enjoys for being a member state. (7 marks)
(b) Many developing countries are literally competing in giving incentives to multinational Enterprises to encourage Foreign Direct Investments in their countries. Discuss the Advantages and Disadvantages brought about by these MNCs to the Host countries.
(8 marks)
Question 6
Write Brief notes on the following International Business concept:
(a) Portfolio investments
(b) Theory of Comparative Advantage
(c) Balance of Payment (15 marks)
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