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    Reflection-Paper Chapter 1 International Management

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    Jouhara G. San Juan
    This document is a thesis submitted by Jouhara G. San Juan for a Doctor in Business Administration degree from the University of Rizal System in Binangonan, Rizal, Philippines. The thesis examines the topic of international financial management and discusses the impacts of direct foreign investment on developing countries like the Philippines. While direct foreign investment can provide benefits such as new technologies, skills, and export opportunities, it also has negative effects such as creating few jobs, competing with local businesses, encouraging corruption, and making the economy more vulnerable to economic downturns when foreign investors withdraw their money. The thesis concludes that while direct foreign investment should still be encouraged, developing countries need to also focus on growing local investments,

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    Reflection-Paper Chapter 1 International Management

    Uploaded by

    Jouhara G. San Juan
    463 views2 pages
    This document is a thesis submitted by Jouhara G. San Juan for a Doctor in Business Administration degree from the University of Rizal System in Binangonan, Rizal, Philippines. The thesis examines the topic of international financial management and discusses the impacts of direct foreign investment on developing countries like the Philippines. While direct foreign investment can provide benefits such as new technologies, skills, and export opportunities, it also has negative effects such as creating few jobs, competing with local businesses, encouraging corruption, and making the economy more vulnerable to economic downturns when foreign investors withdraw their money. The thesis concludes that while direct foreign investment should still be encouraged, developing countries need to also focus on growing local investments,

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    International Financial Management

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    This document is a thesis submitted by Jouhara G. San Juan for a Doctor in Business Administration degree from the University of Rizal System in Binangonan, Rizal, Philippines. The thesis examines the topic of international financial management and discusses the impacts of direct foreign investment on developing countries like the Philippines. While direct foreign investment can provide benefits such as new technologies, skills, and export opportunities, it also has negative effects such as creating few jobs, competing with local businesses, encouraging corruption, and making the economy more vulnerable to economic downturns when foreign investors withdraw their money. The thesis concludes that while direct foreign investment should still be encouraged, developing countries need to also focus on growing local investments,

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    463 views2 pages

    Reflection-Paper Chapter 1 International Management

    Uploaded by

    Jouhara G. San Juan
    This document is a thesis submitted by Jouhara G. San Juan for a Doctor in Business Administration degree from the University of Rizal System in Binangonan, Rizal, Philippines. The thesis examines the topic of international financial management and discusses the impacts of direct foreign investment on developing countries like the Philippines. While direct foreign investment can provide benefits such as new technologies, skills, and export opportunities, it also has negative effects such as creating few jobs, competing with local businesses, encouraging corruption, and making the economy more vulnerable to economic downturns when foreign investors withdraw their money. The thesis concludes that while direct foreign investment should still be encouraged, developing countries need to also focus on growing local investments,

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    of 2

    University of Rizal System

    Binangonan , Rizal
    Graduates Studies
    Doctor in Business Administration

    Name: JOUHARA G. SAN JUAN


    Subject: International Financial Management
    Faculty: Dr. Virgilio V. Salentes

    International Financial Management is defined as investing and financing


    decision that are intended to maximize the value of Multinational Company (MNCs).
    Maximizing the value of a company is a main goal for every firm---thus expansion is one
    of their options. Entity may begin expansion by putting investment, establishing
    ownership or controlling interest in a foreign country, b asically a Direct Foreign
    Investment. The flexibility of Direct Foreign Investment during financial crises
    may lead many developing countries to regard it as the private cash inflow of
    choice, but is having a multinational company good for the host developing
    country?
    For every medical problem there is a specific cure, like there is a solution for
    every economic problem, unemployment, and trade and budget deficit. The direction
    usually taken by developing country is to announce yet another acceptance of a direct
    foreign investment, with thousands of promise jobs along with it. The obsession of
    direct foreign investment, is the mentality that the foreigners will solve everything for
    developing countries, take for example the situation in the Philippines. If we have
    political problems the foreigners will solve it, if we have economic problems the money
    of the foreigners will solve it. Direct foreign Investment is a reliance to outsider to solve
    the problem that the host country themselves should cope with. It is a mixed blessing
    for developing countries with a weak domestic private sector. There is no disputing that
    Direct Foreign Investment brings with them badly needed things, technology, intellect,
    new management techniques, new skills and most importantly they open up

    jouharagsanjuan Page 1
    opportunity for export market---and these are the positive aspect of Direct Foreign
    Investment that cannot be ignore. However for the developing country such as
    Philippines----there are also negative effects. Consider for example, Direct Foreign
    Investment is capital extensive---they invest in automation and not in labour and so
    little employment is created. Second, foreigners compete with local business for scarce
    resources, bank credits and bank loans. These goes to foreigner instead of the locals.
    Then there is a question of whether this Direct Foreign Investment is beneficial to the
    economy or maybe they’re taking much more than what they’re putting in, in the form
    of dividends, royalties, interest on loans, repatriation. Moreover the benefits the Direct
    Foreign Investment gets from the government in the form of lower tax or no tax at all.
    Third, it has been demonstrated and shown that Direct Foreign Investment does not
    foster growth and stability to the economy, actually foreigners seems fickle, they
    weren’t reliable, they change their mind with the first sign of crisis---they pack up, get
    their money and leave the country and therefore they are procyclical, meaning when
    the economy is going up the foreigners go with the economy and if it’s going down
    -----foreigners push the economy further down by withdrawing their money and
    leaving the country. It also displaces local manufacturing and local exporters. How can
    you expect local size business to compete with automated facility foreign companies,
    particularly if they have the same consumers? Lastly, Direct Foreign Investment
    encourages corruptions especially among the politicians in the form of bribes.
    I’m not going to say that Direct Foreign Investment should be avoided or it is a
    bad thing. It is a good thing and it should be encouraged---but the emphasis should be
    on local investments, local businesses, domestic manufacturing, and domestic services
    and although there is evidence that foreign investment benefits the host country, they
    should still assess the effects of Direct Foreign Investment carefully and realistically.
    Local is still the future of a developing country as the Filipinos are still the future of the
    Philippines.

    jouharagsanjuan Page 2

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