MNEs

Emerging Market MNEs

Emerging Market MNEs

Introduction

This assignment is focused on understanding the unique and different strategies which are present in the emerging market MNEs while pursing the globalization and internationalization strategy. this has been done through the examples of the BRIC countries for the emerging countries.

Discussion

Competitive Advantages of Emerging Markets MNEs

It is a widely accepted opinion in the literature of international business that the firm that operates abroad has to face disadvantages as compared to the local competitiors. It is mainly due to the liabilities in trems of being a foreigner along with cost of operating in the distant cultures and markets (Zaheer, 1995). Hence, to have success, it is important for these firms to have firm-speicifc advantages (FSAs) which are inimitable and valuable. The firms that compete in the international market can use not only the FSAs but also the advantages which are country specific (CSAs).

Advanatges which are Country Specific

There are many examples of CSAs which the EMES use at the international level. In Brazil, South Africa and Russia, the EMES took the benefit of the vast natural resources of the country. In India and Chine, they used the benefit of the broad home market along with the availability of the unskilled and low cost skilled worker. In case of Thailand, the entreprenreurs used the benefit of social network in expanding in other countries with the Chinese Communities who are ethnic. In the case of Israel, the businesses have benefitted from the large pool of skilled scientists and engineers who have mainly migrated from the European countries and have foreign social networks and the advanced skills.

All of these examples show that in each country there are certain features which have resulted in the development of certain CSAs. The ear of Apartheid had developed advantages which were unanticipated for the firms of South Africa after the period of Apartheid. The language skills on Indian workers in English along with the large number of Indians who are overseas have developed advantages which were unanticipated for the Indian business that wanted to export the services which are knowledge based to the countries that have high cost. China has also advantaged from the political system which is authoritarian where the decisions can be taken expeditiously and Mexico has been able to take the advantage from its privileged and proximity access to the market of United States.

One of the common characteristic which is common in all the above mentioned countries is that they had pursued the protectionist policies before they started embracing the globalization. The policies in the closed era might not have promoted the international competitiveness or efficiency but it helped in developing the firms in the industry of technology and some of those firms became the EMNEs. In the case of Russia and China, majority of the large EMNEs have roots from the Communist days.

India and China has resulted in resulted in bringing CSAs that are disruptive due to the size of the skilled and unskilled labor pools and the size ...