MARKETING AND ENTERPRISES

Foreign Direct Investment

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Foreign Direct Investment

Summary

Global foreign direct investment in developing countries is expected to reach 416 billion U.S. dollars, an increase of 17 % this year. This report shows that the global investors led by developing countries, expressed optimism about the world economic recovery. Next two years, the global FDI flows to developing countries will return to pre-crisis levels. It was reported that foreign direct investment flows to developing countries increased, helping to promote economic growth and poverty reduction. The report also noted that the next three years in business investment in developing countries, the biggest worry is that political risk. In addition, the market size, quality of financing and investment issues are also serious concerns business investment (Aman 2010, 50).

Hyundai manager is advised to the board of directors and top management about the strategic management plan for Entry to Indian Market and gain the benefit of foreign direct investment (FDI). Hyundai is a huge South Korean company that specializes in Automobile and is in the list of market leaders of South Korean Automobile Industry. The aim of this report is to help the MD decide if the Hyundai should engage in trade and or invest in the market in India. Get an overview of the Indian market, this report provides a detailed analysis of why Hyundai's entry into the Indian market would be an advantage or not. To meet the planned growth in the projected market, Hyundai expects to need to expand production from 10.000 to 210.000 within five years. Given the expected strong growth in the market, Hyundai has realized that its distribution decisions would be critical infrastructure support to meet their market entry and expansion. Hyundai has developed a flexible supplier development optimized vendor options, including the number and type of available suppliers, factors and logistics necessary for the supplier / vendor systems to create, and measured and deliberate increase in the proportion of local suppliers, i.e. the degree of localization (Begg 2010, 90).

Development Directions

South Korea

The South Korea is a major trading nation and financial centre, falling amongst the quintets of trillion dollar economies. Since the 1992 recession, the South Korea's economy has enjoyed sustained economic growth ranging from 2-3% since 2004, outpacing most of Europe. This has allowed the sector to prosper in a diversified market-based economy, in turn enabling high employment, easier access to products and services and thus facilitating most residents with a high standard of living. Economic sustainability is a major source of comparative advantage for the industry due to its influence on demand. This has allowed companies like Hyundai to expand in global markets (Das 2010, 47).

India

India is regarded as one of the vibrant emerging economies worldwide. This is a product of the 2008 reform program, which has resulted in remarkable improvement in the Indian economy. Real GDP in India grew at an annual rate of 9.4% in 2009, representing the fastest increase for 18 years, with the service sector being the chief driver of the increase.

Strong economic ...