Chapter 6 Flashcards
(18 cards)
USMCA (formerly known as NAFTA)
Understand
Sets the rules surrounding the ovement of goods and services, labour, and investments across North America.
Eliminates tariffs and other labour barriers, and promotes fair competition amoung the three countries.
Also protects:
- Intellectual property rights
- including patents
- copyrights
- trademarks
- technical designs
Eurpoean Union (EU)
Understand
- 28 countries in Europe
- Formed to help eliminate obsticales that come with trade when you must pass through multiple countries with different lanugauges and curriencies.
- purpose is to promote peace, economic growth, govermment co-operation, strong bonds between people, political intration, and to ensure that the population can prosper in a safe society.
- The Maastrichty Treaty: involved the first 12 countries who joined the EU and created the framework for it.
- Requriments for becoming an EU memeber:
1. economic stability
2. market economy
3. democratic government
4. postivie human record
5. legal institutions
6. ability to administer the EU laws and policies
Comprehensive Economic Trade Agreement (CETA)
- A free trade agreement between the EU and Canada, made to benfit both countries as they werre large trading partners.
- Benfitis of CETA:
1. removing custom duties
2. makes european firms more competitive in Canada
3. open the canadianservices market to eu companies
4. makes it easier for European firms to invest in Canada
5.
G7
- Purpose is to discuss macroeconomic issues (economic growth, trade liberalization, and helping developing countries).
- The trade organisiation ecmpasses the major economies of the work. First made to dicuss global issues affecting all countries like global economy, security, and energy.
World Bank
Understand
- organisation of 189 member countries (including Canada) that provides monotary and technical support to developing countries
- mission: end extreme proverty and promote shared prosperity
- It achives its mission by oroviding loans and grants to poor countries to help with education, healthcare, infustructure, farming, environmental issues, resource management, and other economic concerns.
International Monetary Fund (IMF)
Understand
- Organaisation tracks trends, anaylzes countries financial performance, warns governments of potential financial problems, provides expertise to governments, and provides a forum for disscussion.
- Represents 186 member countries
- Propose is to promote finanical stability, prevent and solve economic crises, ecnourage growth, and prevent and relieve proverty.
Organization of the Petroleum Exporting Countries (OPEC)
Understand
- Intervoermental organization whose objective is to co-ordinate oil policies amoung its memebers.
- An example of Cartel (a group of independent producers who control supply and fix prices in an attempt to reduce market competition).
Corporate social responsibility (CSR)
Definition
defined as the duty of a company’s management to work in the best interest of the society it relies on for its resources (human, material, and environmental), to advance the welfare of society, and to act as a good global citizen through its policies.
Corporate social responsibility (CSR) benefits
- can be a marketing tool, consumers like buying from compabnies that hae solid CSR track records
- Being socially responsib le dissuades governments from impletmenting reulations that might interfere with businesses. (ie when companies implement their own environmental controls, the government does not have to create pillution laws and pay to monotior compliance).
- Cant attract and retain excellent employees if they have good CSR practices, espcially if they can have a say in their companies practices.
Corporate social responsibility (CSR) criticisms
- Being socieally responsible costs companies money, which reduces the amount of profit a company can earn
- Companies spend valuable time and employee energy on CSR, when they should be concentrating on maximizing shareholders wealth and desmonstate responisbility by obeying laws and paying taxes
- Good corporate practices can be used to distract customers from problems a company may be creating. (like the Imperial Tobacco Canada, supporting programs that prevent youth from smoking, like the Canadian Convenience Store Association’s national age verification invitation, but they still sell one of the most dangerous products available)
- Companies use CSR to enhance their reputation with domestic consumers, but may not act ethically in other countries.
Sweatshops
Definition
- Factories in underdeveloped and developing countries where the employees work in unsafe enviroments, are treated unfairly, and have no chance to address these conditions.
- The factories employ children, often as young as 14-15, who work alongside adults.
- They pay poverty wadges that provide only one-quarter of a living wage in the community.
- Workers are often cheated out of overtime pay
- Companies set unrealistic production quotas
Ethical imperialism
Certain univeral truths or values are standard across all cultures. Ie. If something is wrong in one country, it is wrong in all countries.
Cultural relativism
The values of different cultures should be respected, as ethics of one culture are not seen as better than those of another. Ie. Canadian companies would not impose their values on workers in other countries (example: if laws premit 16 year olds to work wull time, a Canadian owned buisness in that country would hire people of this ag).
Dumping
In an international business context, means selling products in a foregin country below the cost of production or below hte pice in the home country.
get ride of excess pruct without affecting home-country prices.
Subsisdizing
Occurs when the importing of a good is helped through financial assistance from the foreign government.
Microcredit
The grant of very small loans- often as little as 100$- to spur entrepreneurship. The entrepreneur does not need a downpayment or credit history. The money is used to start a small business such as farming, running a small shop, weaving baskets, selling rice, or providing cell-phone service.
Fairtrade
Definition
-Fairtrade is a movement that ensures producers in developing countries receive fair wages, work in safe conditions, and earn a fair share of profits.
-It promotes sustainable practices, better working conditions, and community development, often with a premium paid to support local projects.
-Fairtrade-certified products, like coffee and chocolate, help consumers support ethical trade practices.
International Organization for Standardization (ISO)
Define
- the worlds largest standards-developing group
- ISO certification is critical for international trade, it ensures tthe products and services sourced globally are safe, reliable, enviornmentally reponsible, and interchangable with products from other producers.
