Turkey

The Turkish Republic was founded in 1923, following the fall of the Ottoman Empire. Turkey is strategically positioned at the crossroads of Europe, the Black Sea region, and the Turkic‐speaking republics of Central Asia. It is also situated on the Mediterranean coast at close proximity to the Middle East, the Gulf States, and North Africa. It thus offers an excellent base for economic activities throughout the region. The country was a gateway from the ancient Silk Road to new markets and today is becoming a powerful focal point as a cultural and political intermediary as well as a regional trade center of growing importance. Turkey is the 17th largest economy in the world (Economist, 2003; World Bank, 2001). Turkish culture, history, and people have always fascinated scholars. In recent years, the country also has captured the attention of Western companies and investors. Once highly insular, the Turkish economy has been transformed over the past two decades into a vibrant liberal market within a rapidly modernizing society. It is regarded by the U.S. Department of Commerce as one of the top emerging markets. This article will explore the foundations of the Turkish economy, business system, and business culture from the perspective of foreign companies. Following a brief overview of the economy, the country's market potential is discussed. Next, entry strategies—including potential partnerships with indigenous firms—are recommended. Finally, we offer insights into the business culture, and provide tips for working effectively with Turkish business people. © 2003 Wiley Periodicals, Inc.     

从历史视角看美国贸易政策的本质

美国的贸易政策是指能直接影响美国进出口地理方向和进出口商品结构、跨国投资的政府措施。必须从经济和政治结合的角度去理解美国的贸易政策,美国贸易政策的本质是实现美国国内外经济利益和政治利益的工具或手段。贸易保护主义和贸易自由化都是美国利益的实现方式。认识美国贸易政策的本质为认识中美贸易方面存在的问题提供一种思路。     

The repositioning of Ex-Im bank

In recent years, U.S. government policy has shifted in favor of government export support similar to that provided by other G-7 nations. In a major initiative in 1993, the Clinton administration devised a national strategy to reposition Ex-Im Bank to respond to the long-standing needs of U.S. exporters. Today, there are several hundred million dollars at Ex-Im Bank's disposal to meet or match the subsidies offered by U.S. trade rivals, and there is a determination to use such resources to help U.S. exporters compete. Yet attempts by Congress during 1995 to trim Ex-Im Bank's capacity in the name of budget cutting have reawakened the debate over export subsidies. The author asks whether it is possible that Washington will forget the adverse consequences of the two-decade failure to keep Ex-Im Bank's loan program competitive with support agencies in Japan and Europe? The article uses the 1992 OECD arrangement, with its restrictions on foreign loan programs tied to the purchase of donor exports, to examine the United States' recurring confrontations with foreign export-subsidy programs and the prospects for U.S. government export support in coming years.     

Determinants of Sales Destinations of U.S. Multinational Firms' Affiliates in Developing Countries

This study examines the determinants of the sales of .U.S. multinational firms' affiliates to alternative destinations, including sales to other affiliate firms in a host country and a source country markets as well as sales to other non-affiliate persons in each market. Sample host countries are drawn from developing economies where U.S. multinational firms had affiliate firms during the period 1983–1998. The results of the study reveal that affiliates of multinational firms manipulate sales to minimize international taxation. This is supported by the finding that foreign corporate income taxes: affect sales between affiliate firms favorably, unlike its impacts on sales of affiliates to non-affiliate persons in both a host country and source country markets. Considering all markets together, economic volatility and political instability have minimal impacts on sales of affiliates to other affiliate firms compared to their impacts on sales to non-affiliate persons. The results also confirm that host countries' economic policy reforms and membership in multinational investment guarantee agencies facilitate sales of affiliates to other affiliate firms.     

Foreign Direct Investment in Africa: The Role of Natural Resources,Market Size,Government Policy,Institutions and Political Instability

Data from several investor surveys suggest that macroeconomic instability, investment restrictions, corruption and political instability have a negative impact on foreign direct investment (FDI) to Africa. However, the relationship between FDI and these country characteristics has not been studied. This paper uses panel data for 22 countries over the period 1984–2000 to examine the impact of natural resources, market size, government policies, political instability and the quality of the host country's institutions on FDI. It also analyses the importance of natural resources and market size vis‐à‐vis government policy and the host country's institutions in directing FDI flows. The main result is that natural resources and large markets promote FDI. However, lower inflation, good infrastructure, an educated population, openness to FDI, less corruption, political stability and a reliable legal system have a similar effect. A benchmark specification shows that a decline in the corruption from the level of Nigeria to that of South Africa has the same positive effect on FDI as increasing the share of fuels and minerals in total exports by about 35 per cent. These results suggest that countries that are small or lack natural resources can attract FDI by improving their institutions and policy environment.     

Regulation,deregulation, and internationalisation in South African and New Zealand banking

The banking industries of New Zealand and South Africa were among the most tightly regulated in the western world in the early 1980s. Restrictions on foreign banks were particularly acute, especially in South Africa. From a position of considerable isolation, first New Zealand then South Africa implemented programmes of financial liberalisation. We show that the outcome of liberalisation was different in these two countries. South African banks were able to establish a strong presence in external markets, but the New Zealand banking system was mopped up by its Australian neighbour. These divergent outcomes reflect the origins, geographical position, and unequal capabilities of the New Zealand and South African banking industries.     

Which foreign states support the global use of the Chinese renminbi? The international political economy of currency internationalisation

The internationalisation of the Chinese renminbi has taken a path distinct from most cases involving previous international currencies, in that policy measures adopted by governments have played crucial roles in it. This paper conducts a cross‐country analysis of the factors that have led foreign governments to introduce three primary policy infrastructures to support renminbi use—renminbi swap lines, Renminbi Qualified Foreign Institutional Investor quotas and renminbi clearing banks. Our analysis shows that a state holding renminbi assets among its reserves or having more developed financial markets is likely to establish a higher level of policy infrastructure supporting renminbi use. We also find that a country's economic and political relations with China may have meaningful impacts on the level of its establishment of those renminbi‐related policy infrastructures. These findings significantly expand our understanding of renminbi internationalisation, by identifying which non‐Chinese factors have affected its progress to date. They also contribute meaningfully to the literature on currency internationalisation and international currencies in general, by calling attention to the roles of foreign states in the process of a currency's internationalisation.     

Complying with environmental regulations in foreign markets

A variety of economic and social factors have created attractive opportunities for U.S.-based businesses to compete in foreign markets. Although foreign environmental regulations are increasingly complex and demanding, there are many resources available to help ensure compliance. Beyond compliance, progressive environmental regulations in foreign countries will create opportunities for American businesses to compete effectively with advanced technology, management competence, and experience in operating in the highly regulated climate in the U.S. Packaging and packaging waste regulation in the European Community exemplifies both the regulatory complexity as well as the competitive opportunities of competing in foreign markets. © 1993 John Wiley & Sons, Inc.     

Movies and the Mystery of the Missing Trade: Is Hollywood Good for U.S. Exporters?

Research has shown that consumers have a preference for goods based on the origin of production. This is important because it suggests that, in some cases, even lowering trade barriers may not significantly increase trade flows. In particular, flows may be lower than are predicted by trade theories such as Heckscher-Ohlin. Despite evidence that home consumption bias exists in many countries, it is only recently that research has begun to examine the sources of this bias.

This article fills a gap in the literature by testing a model that addresses the source of this consumption bias. The paper's model incorporates consumers' exposure to foreign products and culture through media imports and tourist visits as factors affecting consumers' preferences for foreign products. Using panel data from 19 countries, the article's results support the hypothesis that lagged exports of U.S. movies have a positive impact on other U.S. exports. Some evidence is also found of a positive effect of tourist visits on U.S. exports.

Since U.S. media exports may generate demand for other U.S. goods and services, opening up foreign media markets should receive a higher priority in U.S. trade negotiations. Another interesting implication of the paper is that overall U.S. export losses resulting from media piracy may be lower than previously calculated, as the consumption of pirated media products may increase demand for other U.S. exports.     

Entering the last frontier: expansion by US multinationals to Africa

Literature on multinationalism, even that which focuses on economic development and incentives for foreign direct investment (FDI), largely ignores the African continent despite its market of over 700 million inhabitants and its unique challenges for foreign firms. However, the African continent provides an important arena for examining the effects of infrastructure, wealth, and political differentials across countries and the effects of these variables on the expansion decisions of US multinational corporations (MNCs). In this paper we examine the US stock market reaction to announcements of US firms entering African markets through both FDI and Non-FDI modes. Finally, we investigate the accounting performance implications of these expansions. Our results show that, on average, firms experience negative wealth effects when expanding to Africa. Further analysis shows that expansions to South Africa produce losses, while expansion to the rest of Africa produce positive gains. We also show that firms with higher return on equity perform better than firms with lower return on equity when they expand to Africa in countries other than South Africa.     

Assessments of selected foreign suppliers by Saudi importers: Implications for exporters

Importing intermediaries' evaluations of alternative suppliers play a significant role in export success. This paper reports on a systematic study of Saudi Arabian importers' assessments of suppliers from four leading exporting countries — the U.S.A., Japan, England, and Taiwan. Importing middlemen are extremely important to a foreign company's success in penetrating the lucrative Saudi market. Therefore, a better understanding of how favorably these middlemen view alternative suppliers is essential for any exporter to this market.     

Reinforcing Cultural Identity by Appealing to Local Cultural Cues: National Identity Formation and Consumption in High-Context Cultures

Traditionally, U.S. firms have successfully used American appeal (hard-sell approach) as a unique selling proposition in Europe, Japan and in the developing world. However, the anti-American sentiments around the world due to the Iraqi and Afghan wars and recent upheavals in the Middle East and North Africa have negatively influenced consumer judgments about American-labeled global brands in international markets during the last decade. Such consumer perceptions may lead to a favorable environment for new competitors to emerge in specific markets, and these products may take significant market share away from global U.S. brands.     

ECONOMIC TRANSITION IN CENTRAL AND EASTERN EUROPE: THE CONSEQUENCES FOR TRADE STRUCTURE AND TRADE VOLUME

The foreign policy literature typically sees Congress abdicating its policy making role to the executive, implying a presidential dominance model is superior to other policy process models (joint participation, congressional dominance, and bureaucratic dominance). This article uses two theoretical approaches to investigate who actually makes U.S. trade policy: a political economy approach and an institutional approach. We look at the 1985 96 period and at individual presidencies: Reagan (1985-88), Bush (1989-92), and Clinton (1993-96). Contrary to the literature, we find strong evidence that Congress is an active participant in the trade policy making process. Using a variety of empirical techniques (crosstabs, the Index of Revealed Comparative Advantage, pairwise correlations, and stepwise logistic regressions), we confirm that the trade policy process for product-industry-specific policies tends to be dominated by Congress whereas the executive branch is more influential in the policy process for country-specific policies. We conclude by noting the advantage of integrating aspects of both the political economy of trade and institu tional literatures to understand the nuances of U.S. foreign trade policy making.     

Doing business in Brazil: A strategic approach

Brazil has the largest economy in South America, and the second largest in Latin America, offering one of the most promising markets in the world. Along with China and India, Brazil is ranked among the nations with the highest predicted development rates in the next 25 years. In the early 2000s, Brazil accounted for 56% of all foreign direct investment flows to South America and 52.5% of the foreign direct investment stock in South America. Brazil is also a key player in the design and development of the Free Trade Agreement of the Americas (FTAA), which is scheduled to be effective by 2005. The FTAA is expected to be the world's largest regional trading block. In 2002, Brazil was ranked twelfth amongst the largest economies in the world. Brazil is one of the world's “Big Five” emerging markets, along with China, India, Mexico, and Indonesia. In the past decade, Brazil was second to China among emerging economies for received foreign direct investment. This article elaborates on the main aspects of doing business in Brazil and discusses some of the challenges and opportunities facing the Brazilian economy. © 2004 Wiley Periodicals, Inc.     

Public policy influences on the formation of international joint ventures

The literature on international joint ventures (IJVs) devotes little attention to the influence of public policy on the formation of such alliances. This paper examines the influence on the recent growth in IJVs of U.S. and foreign governments’ antitrust, trade, and technology policies. Little evidence supports the claim that U.S. antitrust policy is a critical influence on the decisions of U.S. firms to collaborate with foreign enterprises. IJVs are rarely substitutes for the collaboration among U.S. firms that might develop in the absence of antitrust restrictions. The recent interest by governments in “strategic technology policy” and the growing importance of “managed trade” in some high-technology industries both have created new incentives for the formation of IJVs. There are some important parallels between recent international joint ventures and the international cartel agreements of the interwar period, but modern IJVs do not yet appear to have reproduced the cartelization associated with the international patent-sharing agreements of the interwar period. Nevertheless, the influence of these market-distorting government interventions on the incentives to form IJVs means that the effects of these alliances on economic welfare may be mixed and should be monitored carefully.     

Infrastructure Development and Regulatory Reform in Sub‐Saharan Africa: The Case of Air Transport

This paper analyses the main policy issues raised by regulatory reform in air transport in sub‐Saharan Africa. Its basic premise is that improving ait infrastructure is of paramount importance for the region as it tries to integrate more thoroughly into the world economy. On the basis of the experience of OECD countries with privatisation, liberalisation, and regulatory design, the author analyses progress being made in sub‐Saharan Africa and identifies three important case studies: the restructuring of the regional airline of Francophone Western Africa, the sell‐off of the state‐owned airline of Kenya, and the overall reform process in South Africa, by far the largest market in the sub‐continent. The analysis highlights the importance of regional dynamics in the upgrading of the air transport industry in developing and emerging areas. Sub‐Saharan Africa has made smaller progress in this respect than, for instance, Central America. As the start of the Millennium Round and the first WTO air transport review approach, these issues will gain policy priority for all countries, and may become powerful bargaining tools for non‐OECD countries to press for more open access into OECD markets for the South's traditional exports.     

„Rettungsprogramme“ für Krisenländer verschärften die Krise — eine Replik

In his reply, Niemeier accuses Boysen Hogrefe and Stolzenburg of erroneously ascribing the failing of the Greek programme to insufficient “ownership”, whereas the true cause is — in his view — an inadequate austerity policy. The alleged success of this policy in Portugal and Ireland refers solely to GDP growth and ignores the continuing high levels of unemployment in those countries. Boysen- Hogrefe and Stolzenburg insist that the “success” of a rescue programme actually implies that the respective country is able to return to capital markets. The Greek crisis was structural rather than cyclical, so a temporary stabilisation of domestic demand (financed by additional foreign debt) would not have solved the issue.     

Trade Policy and the Obama Administration

During his primary campaign, President Obama took an aggressive stance on trade, suggesting a protectionist drift in U.S. trade policy. However, it seems more likely that policy will focus more on enforcement of existing rights than on protectionist initiatives. The major influences on trade policy are likely to be multilateral approaches to trade problems, broad foreign policy concerns, the impact of trade policy on recovery from the current recession, and global climate change initiatives. Holdover initiatives on the World Trade Organization's Doha round and bilateral agreements will be joined by global climate change as the principal policy issues for the next few years.     

An explicit partial‐equilibrium model to justify the Generalized Marshall‐Lerner condition (GML)

Robinson's derivation of the Marshall‐Lerner condition (ML) is more general in that she considers a situation where initially the trade balance is not in equilibrium with the incorporation of the supply curves of exporters. This paper examines a partial equilibrium analysis of a country's imports and exports markets within a theoretical model which considers both the demand and supply sides in these two internationally traded‐goods markets. The aim here is to show explicitly how the Generalized Marshall‐Lerner condition (GML) of Robinson can be obtained. We examined the two effects of the nominal depreciation of the domestic currency on the trade balance: the volume effect and the value effect and how they counterbalance each other. We found that the standard Marshall‐Lerner condition (ML) was not sufficient when the trade balance was initially in deficit and it was also not necessary if the trade balance showed an initial surplus. Moreover, this study provides a new interpretation for Robinson’ sufficiency condition where the trade balance must improve following a nominal depreciation of domestic currency when the elasticity of foreign demand exceeds the ratio of imports to exports. This paper also examines the situation of a small open economy which could not influence the world prices where the foreign demand for exports and the foreign supply of exports are infinitely large. Finally, there is a discussion on two policy implications for exchange rate regulation: the amount of devaluation that is necessary to improve a given trade imbalance as a governments intervention and additional support for the slow improvement of the trade balance in the short run after a devaluation policy known as the J‐Curve effect.     

As the dollar sinks,will the yuan float?

Many scholars believe with the United States' increasing debt, the global position of the dollar is weakening. As the dollar declines, China, now the largest holder of U.S. dollars in the world, is understandably concerned. China's controversial peg to the U.S. dollar, combined with its $2.4 trillion in foreign reserves and trade imbalances, is debated daily by politicians and economists. This article presents arguments for and against the current China monetary policy in economic and political contexts. Statements from China's leaders, other global leaders, and economists are reviewed. Economic and political obstacles and incentives in the context of their influence on the China government are considered. Finally, milestones for business leaders to look for are suggested to help determine China's possible path to a fully convertible yuan. © 2010 Wiley Periodicals, Inc.