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For General Motors (GM), the year 2004 brought a wide variety of new challenges that added to an already complex business environment. The industry structure was changing quickly. Demand and supply projections for motor vehicles had promised substantial increases in sales and profits, but suddenly the optimism faded. China's new membership in the World Trade Organization created expectations of a level playing field for foreign investors, but - at least in the short run - major barriers remained. Government intervention persisted, particularly the requirement of a joint venture partner, competition from government-owned assembly firms, and arbitrary rules such as sector-specific credit restrictions. Violation of intellectual property, with the copying of foreign automobile designs and false-branding of parts, was an ongoing threat. Also, inflation was increasing and the government was unsure whether and how to use monetary and fiscal policies. The government had purposely kept the renminbi undervalued for many years. Pressure was building for the government to change its foreign exchange rate policy, but a higher renminbi would suddenly decrease GM China's international competitiveness.

For General Motors (GM), the year 2004 brought a wide variety of new challenges that added to an already complex business environment. The industry structure was changing quickly. Demand and supply projections for motor vehicles had promised substantial increases in sales and profits, but suddenly the optimism faded. China's new membership in the World Trade Organization created expectations of a level playing field for foreign investors, but - at least in the short run - major barriers remained. Government intervention persisted, particularly the requirement of a joint venture partner, competition from government-owned assembly firms, and arbitrary rules such as sector-specific credit restrictions. Violation of intellectual property, with the copying of foreign automobile designs and false-branding of parts, was an ongoing threat. Also, inflation was increasing and the government was unsure whether and how to use monetary and fiscal policies. The government had purposely kept the renminbi undervalued for many years. Pressure was building for the government to change its foreign exchange rate policy, but a higher renminbi would suddenly decrease GM China's international competitiveness.

The costs of global warming are enormous. The increase in concentration of greenhouse gases, as a result of growth in industrial activities worldwide, is directly related to the increased frequency of natural disasters. United Nations has estimated that the effects of global warming (namely natural disasters, loss of land due to rising sea levels and damages to fishing stocks, agriculture and water supplies) could cost over US$300 billion annually. The Kyoto Protocol is an international agreement setting out legally-binding levels of greenhouse gas emissions for 160 participating nations. The signatory nations approved the principles of the treaty, leaving the operation and enforcement details to be determined. While the intent of the protocol, to reduce worldwide greenhouse gas emissions to the benefit of all countries, is honorable, the impacts of the Kyoto Protocol are difficult to predict and will affect its stakeholder groups (the insurance industry, developed and developing nations, signatory and non-signatory countries, existing and potential industries) differently. Implementation issues, alternate approaches, the challenges of global environmental problems and possible solutions are discussed. The response of governments and businesses to global environmental issues, in general, and to the Kyoto Protocol, in particular, will determine the strengths and weaknesses of this global initiative.

The Canadian Imperial Bank of Commerce was the first major financial institution in Canada and among the first in North America to team up with an external supplier to manage its human resource operations and technology services. As such, the company required a carefully structured contract that included the necessary requirements and at the same time left room for flexibility and change. This is a supplement to CIBC Human Resources (A), product 9B02C062.

The Canadian Imperial Bank of Commerce (CIBC) is one of the 10 largest full-service financial institutions in North America. Its human resources department wanted to reinvent HR service delivery and increase automation and self-service operations. A number of options were being considered, including continuing with the status quo while undertaking patchwork operations, developing new HR capabilities in-house, outsourcing the development of HR capabilities, and exploring the opportunity to outsource entire functions. Each option presents benefits and challenges, and the senior lead on the project must begin to develop a business case to go forward. The supplemental case CIBC: Outsourcing the Human Resources Department (B), product 9B02C063 discusses the human resources outsourcing agreement.

China's entry into the World Trade Organization at the end of 2001 brought promises that foreign financial institutions would be permitted to operate through China. In 1998, Citicorp and Travelers Group Inc. had merged to create the new Citigroup Inc. Travelers brought a vast array of financial services that added to Citibank's existing portfolio of consumer and commercial lending. Travelers had developed a very extensive business in investment banking, asset management, life insurance, property casualty insurance, as well as consumer lending. Citigroup now had to determine the business prospects for each of its activities in the growing China market. Fears of social and economic dislocation might lead China to impose regulatory restrictions limiting the pace of foreign expansion. Economic growth might be impeded by the existing political structure, and reforms might not occur in the near term. A myriad of other challenges included human resources difficulties, e-commerce limitations and regional disparities. The pace of privatization of state-owned enterprises and the societal preferences in regard to alternative insurance and investment products added to uncertainties. Citibank had a record of success in less developed countries, and had developed certain competitive advantages that might be the basis for success in China, but whether and how these could be extended to other Citigroup financial activities remained an important question.

China's entry into the World Trade Organization (WTO) at the end of 2001 brought promises that foreign financial institutions would be permitted to operate throughout China. In 1998, Citicorp and Travelers Group Inc. had merged to create the new Citigroup Inc. Travelers brought a vast array of financial services that added to Citibank's existing portfolio of consumer and commercial lending. Travelers had developed extensive businesses in investment banking, asset management, life insurance, and property/casualty insurance, as well as consumer lending. Citigroup now had to determine the business prospects for each of its activities in the growing China market. Fears of social and economic dislocation might lead China to impose regulatory restrictions limiting the pace of foreign expansion. Economic growth might be impeded by the existing political structure, and reforms might not occur in the near term. A myriad of other challenges included human resources difficulties, e-commerce limitations, and regional disparities. The pace of privatization of state-owned enterprises and the societal preferences in regard to alternative insurance and investment products added to the uncertainties. Citibank had a record of success in less developed countries, and had developed certain competitive advantages that might be the basis for success in China, but whether and how these could be extended to other Citigroup financial activities remained an important question.

Chauvco quickly became one of the top 30 oil companies in Canada. Rising costs and diminishing oil and gas reserves led Chauvco to consider investing in other countries. In 1992, Chauvco purchased an interest in an Argentine oil and gas block that was being privatized. Chauvco's success in Argentina depended on the country's future political stability and the continuance of government policies. Prior to the 1989 election of Carlos Menem, Argentina experienced decades of political and economic instability, the government nationalized many businesses and imposed detailed regulations throughout the economy - a set of policies that led to low growth, budget and trade deficits, hyperinflation, and currency devaluation. Whether Menem's reforms could achieve long-term success remained to be seen. Chauvco encountered a number of difficulties, as well as some positive aspects of the environment of business. The company initially entered a joint venture partnership and then developed an independent set of operations. By 1995, Chauvco had to decide in what proportions it should divide its future investments between Canada, Argentina and other countries, and what criteria it should use in evaluating investment opportunities. This is an abridged version of 9A95H003.

Lucent Technologies is a worldwide provider of telecom network infrastructures. The government of India has deregulated the state-run control of the telecom sector presenting significant opportunities for telecommunication providers. India appeared to be a nation of enormous investment opportunity, with a population of one billion and a relatively high growth rate. Lucent Technologies must evaluate the opportunities in this changing market and decide whether they should invest more resources in this area or withdraw completely.

As it entered the 21st century, the Polish government faced the dilemma of how to develop an optimal telecom structure and related services. For decades, the government owned and operated a national telecom monopoly, but in the late 1990s they gradually allowed the entry of some competitors, many of whom brought new technologies. The government had undertaken a major privatization program, and it faced the question of whether, and how, it should privatize; yet privatization would have to be accompanied by ongoing regulation in order to ensure that managerial decisions were made in the interests of the nation, as a whole. This challenge of continual government intervention could reduce the attractiveness of acquiring the government-owned agency, in spite of its market dominance. Students will have the opportunity to: analyze the telecommunications industry in Poland; determine the technological changes that will impact the future of telecommunications throughout the world and the Polish telecom industry; examine the current regulatory environment in the Polish telecommunication market; evaluate the current state of, and the opportunities in, e-business in Poland and the rest of Europe; and, develop a comprehensive action plan for a joint venture partner.

Like many other financial institutions, ING faces the challenges and opportunities of globalization. This case examines financial integration within the European Union, the attempt to harmonize regulations and the creation of a single currency. The Basle Accord establishes international standards for a financial institution's capital as a percentage of loans. There is currently an attempt to modify these standards to reflect the differences in risk associated with different types of assets. The case also examines emerging markets and the foreign exchange crises that repeatedly impact these countries. Finally, the case examines the shift towards electronic commerce and the possibility of entering new markets without having to build or acquire physical facilities. Students are encouraged to analyze these basic changes in the environment of business and to consider how these changes may impact the globalization strategy of a financial institution.

One of Canada's high-tech success stories, Bombardier, changed the airline industry with the introduction of its short-haul turbo-prop planes and jets in the early 1990s. By the mid-1990s, a new player from Brazil, Embraer, had entered the market and was capturing a lot of business from Bombardier. Bombardier claimed that the success of Embraer was due to unfair subsidies through a government program, so Bombardier challenged the policies through the WTO. Embraer charged back that Bombardier had long received subsidies through Canadian government loans and grants. In an industry which was expected to double in the next five years, the stakes were high. This case discusses the dispute resolution process within the WTO, and the impacts that subsidies and WTO subsidy restrictions may have on industry structure.

Through acquisitions and innovative management, Moscow Joint Stock Commercial Bank Vozrozhdeniye (V.Bank), had grown to be one of the largest banks in Russia. In a market with many competitors of varying strength and reliability in an unstable business environment, V.Bank was attempting to become a true commercial bank, fashioned after the operations of western banks. The Canadian Imperial Bank of Commerce had undertaken a World Bank contract to assist V.Bank in this process. However, in October 1998, as the Russian economy grew worse, management of V.Bank wondered if it would be able to survive the crisis, let alone continue towards its goal of transforming its operations into those that were competitive with the western banks. This case is appropriate for courses where the goal is to provide students with the ability to understand and forecast broad economic forces and incorporate this information into a decision-making process. The student is forced to make strategic decisions in a situation of uncertainty and instability, and in crisis mode, in an emerging market. Issues that need to be resolved include privatization, economic and monetary policy, IMF and World Bank intervention, societal stability, and government regulation.

A major threat to the existence of the CAW is the trend towards outsourcing the production of components to non-unionized, hence lower-cost manufacturers, by the Big Three Automakers (GM, Ford and Chrysler). This trend is costing Canadian Automobile Workers Union (CAW) members their jobs. The typical retaliation is CAW strikes, and negotiating job security agreements. This short-term strategy in fact encourages the move to offshore production in order to remain competitive. The purpose of the case is to discuss issues concerning the evolution of the Canadian economy from one which is manufacturing-based to one based on services, and to try to find answers to questions like: Can the CAW survive? Will the Big Three be producing cars in Canada in the 21st Century? Where else would they go? What are the concerns in moving production off-shore? What kind of strategy should the CAW follow to ensure its survival? How does Canadian automobile production relate to the global industry? How will governments impact the industry?

For many decades, a high degree of political risk discouraged foreign investment in Latin America. Recent years have witnessed major changes in the nature and extent of Latin American country risks, with a dramatic reduction of political risks, and a new focus on economic risks. At the same time, there has been a vast opening up of investment opportunities where Canadian corporations can transfer modern technology and business practices that exceed the capabilities of domestic corporations, creating country- and industry-specific competitive advantages. However, Latin American countries still rank very poorly in the factors underlying international competitiveness, with the result that labor-intensive export facilities are more likely to be located elsewhere, in spite of Latin America's low wage levels.

Multimedia Development Corporation was established to build and regulate the Multimedia Super Corridor (MSC) in Malaysia. As Malaysia's traditional manufacturing advantage due to low-cost labor dissipated and as the country targeted the year 2020 for achieving developed status, the MSC was being viewed as the catalyst to launch the Malaysian economy into the future. Malaysia's government hoped the MSC could become a hub for high technology in Southeast Asia. It was now necessary to involve private sector corporations in refining the MSC concept, setting priorities for development, and establishing the standards that would be imposed on activities in the MSC.

Multimedia Development Corporation was established to build and regulate the Multimedia Super Corridor (MSC) in Malaysia. As Malaysia's traditional manufacturing advantage due to low cost labor dissipated and as the country targeted the year 2020 for achieving developed status, the MSC was being viewed as the catalyst to launch the Malaysian economy into the future. Malaysia's government hoped the MSC could become a hub for high technology in Southeast Asia. It was now necessary to involve private sector corporations in refining the MSC concept, setting priorities for development, and establishing the standards that would be imposed on activities in the MSC.

This note is a description of the competitive structure of the Mexican beer industry in 1994. It is written to provide information necessary to evaluate the Mexican market in regard to its export potential and/or investment potential. Labatt Ice, was written at the same time, and it compares the Canadian and U.S. markets. This note enables the discussion to be extended to also include the Mexican market.

Citibank was the first U.S. bank to establish operations in China when it opened a branch in Shanghai in 1902. From the early 1940s until 1984, Citibank was absent from China, but since 1984 it had gradually reestablished an active presence. In 1997, Citibank had reached a crossroads. It had to decide how best to participate in the rapid growth of the Chinese economy and the huge inflow of foreign direct investment. Citibank had many competitive advantages on the basis of which it had established a unique strategy that excluded joint ventures. In 1997, a wide variety of new potential services included credit cards, RMB (Chinese currency) banking, and various fee-based services. Government regulations still severely restricted the types of loans foreign banks could make, but it was expected that these regulations might soon be liberalized. How should Citibank, N.A. in China best position itself for the future?

Citibank was the first U.S. bank to establish operations in China when it opened a branch in Shanghai in 1902. From the early 1940s until 1984, Citibank was absent from China, but since 1984 it had gradually re-established an active presence. In 1997, Citibank had reached a crossroads. It had to decide how best to participate in the rapid growth of the Chinese economy and the huge inflow of foreign direct investment. Citibank had many competitive advantages on the basis of which it had established a unique strategy that excluded joint ventures. In 1997, a wide variety of new potential services included credit cards, RMB (Chinese currency) banking, and various fee-based services. Government regulations still severely restricted the types of loans foreign banks could make, but it was expected that these regulations might soon be liberalized. How should Citibank N.A. in China best position itself for the future?