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The nationality of global companies has become less ambiguous and more strategically important in recent decades.

Predictions of global economic integration are at odds with the facts: Most types of economic activity that might cross borders are still largely focused at home.

Describes the political ramifications in the United States of Dubai-based DP World's acquisition of London-based Peninsular and Oriental Steam Navigation Company (P&O). Because P&O operated some port terminals in the United States, DP World obtained clearance from the Committee on Foreign Investments in the United States before P&O shareholders approved the deal in February 2006. Nonetheless, a ruckus over port security erupted both in Congress and in the press and this ruckus led DP World to promise that it would relinquish the U.S. terminals of P&O. Also contains a brief description of Dubai and its relationship to the U.S., a discussion of issues related to port security, and a brief history of U.S. security concerns with foreign direct investment. Ends with a depiction of the Bills passed unanimously by the U.S. House and Senate to further regulate foreign investment in the wake of the DP World debacle.

Supergrid is a mammoth wind-power development scheme for Europe, recently proposed by Airtricity. This firm, founded in 1997, is a fast growing power-development company focused on wind. Already having built about 600 megawatts of wind turbines in Scotland and Ireland, Airtricity has now expanded to the United States. But its "Supergrid" proposal, to build offshore wind turbines with capacity of 30,000 megawatts of power would change the face of European energy networks, use new technology, and help several European countries meet their Kyoto targets for reducing CO2. The issues are whether a small company like Airtricity has the human and capital resources to pull this off, and whether the U.K., Germany, the Netherlands and the EU can be made to cooperate on such a project.

Shareholders of Unocal, a mid-sized American oil and gas firm, had watched the value of their stock rise ever since rumors of a takeover surfaced early in 2005. Trading in the low US$40s at the beginning of the year, competing firms outbid each other, taking Unocal's per share price above US$60 by mid-summer. International oil companies, flush with cash due to high oil prices and facing low reserve replacement rates, increasingly sought to acquire strategic assets. Unocal's significant natural gas reserves in Asia, combined with its expertise in deep water drilling, made it a particularly attractive target for CNOOC, China's state-controlled offshore oil company. Though CNOOC trumped earlier offers with a US$67 per share, all-cash deal, valued at US$18.5 billion, the firm encountered stiff opposition from Washington and Wall Street.

Under the leadership of the al-Maktoum family, Dubai, a member of the United Arab Emirates, invested heavily in its infrastructure to reduce national dependence on oil and gas reserves. As an established international destination for shipping, business initiatives, and tourism in the Middle East, Dubai embarked on a new megascale project: to construct the world's largest amusement park, called Dubailand. Examines various aspects of Dubai's background, world real estate and tourism trends, and environmental and political conditions of the region to support a discussion of this ambitious project's feasibility.

In mid-February 2006, Christopher Smith, a U.S. Republican Congressman, proposed the Global Online Freedom Act, draft legislation that would prohibit U.S.-listed Internet companies from complying with the demands of Internet censorship and the requirement to disclose the personal information of Internet users imposed by the People's Republic of China. These U.S.-listed Internet companies include hardware and/or software vendors and search services providers that enable millions of businesses and individuals to operate on the Internet. The bill was introduced following a congressional hearing in Washington, D.C. called in February 2006, after a number of American Internet companies were found to be participating in the repression of human rights in China. Looks at the dilemma facing multinational firms: how to comply with local laws while at the same time trying to be socially responsible.

When a public sector agency decides to privatize a large government function (as opposed to a more discreet job), the process of negotiating the service contract becomes a more complex and far-reaching endeavor. This case study describes the dilemmas that surfaced when a government agency in British Columbia-the Ministry of Provincial Revenue-negotiated a 10-year, $750 million contract for non-tax revenue collection to EDS Canada, a subsidiary of the Texas-based Electronic Data Systems corporation. The appeal of the deal, from the public sector perspective, was that it transferred the risk of upgrading an outmoded, under-resourced system to the private sector. The appeal to the private sector was that it allowed the company to recover costs and make a profit by taking a share of the financial benefits that resulted from the upgrade. But negotiating the ins and outs of the contract for this ambitious project was to prove a formidable-nearly an insurmountable-hurdle for two organizations that inhabited different cultures, held different assumptions, and pursued different mandates. For example, what profit level was reasonable? Should the company be required to reveal its costs to the government? To what extent should the details of the contract be public, if at all? In what areas-if any-should public officials be able to regulate the firm's business practices? And how should either party be held accountable for its contractual promises? The case was developed for a Kennedy School course on public-private partnerships. It affords students a balanced, inside look at the nitty-gritty dilemmas of both the public and private sector negotiators. HKS Case Number 1835.0

For more than 70 years, beginning in 1929, one party-the Party of Institutional Revolution, known by its Spanish initials PRI-dominated political life in Mexico, at all levels of government. But when Vicente Fox, a candidate of the rival National Action Party (PAN) won the presidency in 2000, change rippled through the country's overall political structure. This case tells the story of the emergence of competitive elections at the municipal level-in particular, one municipality emblematic of larger change. In describing the change in political life in Chignahuapan, a jurisdiction of some 50,000 in the Sierra Norte mountains northeast of Mexico City, the case frames the question of whether electoral change can lead to sustainable reform of local government. It is a question which arises when, surprisingly, a reform-minded PAN administration gains power in the locality in February 2002-and proceeds to change both administrative processes (opening meetings of the local Council for the first time) and moving generally toward transparency and improved local services. The reform administration, was, however, limited by law to just one term-thus, posing the central question of the case: in what ways can a reform administration seek to ensure that the changes it initiates will not be transitory? HKS Case Number 1841.0

For more than 70 years, beginning in 1929, one party-the Party of Institutional Revolution, known by its Spanish initials PRI-dominated political life in Mexico, at all levels of government. But when Vicente Fox, a candidate of the rival National Action Party (PAN) won the presidency in 2000, change rippled through the country's overall political structure. This case tells the story of the emergence of competitive elections at the municipal level-in particular, one municipality emblematic of larger change. In describing the change in political life in Chignahuapan, a jurisdiction of some 50,000 in the Sierra Norte mountains northeast of Mexico City, the case frames the question of whether electoral change can lead to sustainable reform of local government. It is a question which arises when, surprisingly, a reform-minded PAN administration gains power in the locality in February 2002-and proceeds to change both administrative processes (opening meetings of the local Council for the first time) and moving generally toward transparency and improved local services. The reform administration, was, however, limited by law to just one term-thus, posing the central question of the case: in what ways can a reform administration seek to ensure that the changes it initiates will not be transitory? HKS Case Number 1841.1

The role of distressed debt funds, also known as "vulture funds," in sovereign debt restructuring was a hotly debated topic, especially after the success of Elliot Associates in converting an $11 million investment in Peruvian bonds worth $21 million into a $58 million cash payout from the country, representing the full face value of the bonds plus past-due interest. Highlights the problems associated with debt restructuring coordination. On the one hand, many observers derided firms such as Elliot and Dart as "vultures" or "rouge creditors" who sought to profit on sovereign debt restructurings at the expense of countries suffering economic hardship and of the majority of bondholders whose cooperation allowed the restructurings to take place. Critics believed that these holdout creditors created "collective action problems" and presented a major obstacle to successful sovereign debt restructurings. On the other hand, other observers argued that activist investors actually improved the market overall by demonstrating the enforceability of contracts. In fact, they argued that creditors faced too many hurdles in collecting against countries after receiving favorable judgments in support of claims.

Labor churn should be taken into account when assessing the costs of doing business in China.

The U.S. Supreme Court struck down the laws of 11 states that permitted in-state wineries to sell wine directly to customers in those states but prevented out-of-state wineries from doing the same. While the wine decision will help wineries that serve customers via the Internet, its economic implications are much greater for markets such as real estate and automobiles. The court's broad interpretation of the Commerce Clause has the potential to eliminate many of the protectionist practices that states have developed to shield local firms from out-of-state competition, particularly that fostered by the Internet. Consumers will save an estimated $23.7 billion per year if these protectionist practices are eliminated.

Five years following China's accession to the World Trade Organization (WTO), foreign banks are scheduled to be granted full access to the country's vast local currency in December 2006. The foreign banks' competitive attributes, such as size and international banking experience, have facilitated their entry into China. These efforts, however, have been countered by the improving competitiveness of Chinese banks. Further prompted by high entry and operating costs in Renminbi (Rmb) business, foreign banks have engaged in different strategic responses to these challenges. All things considered, it is envisaged that only a very small number of foreign banks will be able to emerge as big players in the Chinese banking market.

The Chinese operations of Alcatel, a global communications solution provider based in France, were faced with strong local competition and a difficult market. It remained unclear how Alcatel would be able to recover growth in the Chinese market. Initiatives were underway to increase focus on services over equipment, to increase Chinese research and development presence, and to merge with U.S. competitor Lucent.

Emerging economies such as India have become an increasingly important part of the global business landscape. Until recently, multinational corporations (MNCs) relied on joint ventures (JVs) with local companies to exploit these business opportunities. Lately, however, there has been a marked reduction in the formation of new JVs between MNCs and local companies. Moreover, many earlier JVs also are increasingly being terminated, often with great acrimony. Highlights how "regulatory liberalization" of the business environment in India has played a big role, directly and indirectly, in driving this change. Also demonstrates how three other factors--"resource complementarity (or lack thereof) between partners," the "race to learn" between partners, and "returns to globalization to MNC partners"--are affecting the formation of JVs in an increasingly liberalized environment.

Tells the story of Argentina's aggressive strategy for renegotiating its sovereign debt from 2003 to 2005. Most creditors accepted the offer to swap their debt for new securities worth 35 cents on the dollar, with no recognition of all past-due interest. Many holdouts, however, remain outside the deal. Some experts believe that Argentina's stance will have negative consequences for the country's private sector and gives a worrisome signal about public policies; others maintain that circumstances beyond the government's control had placed the country in an unsustainable situation, and the successful renegotiation opens up new opportunities. The case presents the story of Argentina's debt saga from the point of view of the country's creditors (foreign and domestic), its government, and private Argentine companies that had to do business in the post-renegotiation environment. Also, discusses the larger issue of how the international financial community should handle sovereign debt workouts.

In 2006, the Philippines faces a difficult choice. Japan has offered the country a trade agreement that includes access to the Japanese labor market for Philippine nurses and other professionals. The same trade agreement, however, means opening the country's manufacturing enterprises to Japanese exports, which is bitterly opposed by some of the nation's largest foreign investors. President Gloria Arroyo--embattled by coup attempts and political scandals--must decide whether to advance the nation's three-decade-old strategy of encouraging the export of its labor resources or whether to attenuate that strategy to meet the demands of large foreign investors.

In the autumn of 2002, JAFCO Asia, a subsidiary of JAFCO Co., Ltd., became the first foreign private equity firm to open an office in Beijing's Haidian Science Park. JAFCO was the only Japanese private equity firm operating in China. As such, Managing Director Vincent Chan observed, "JAFCO is the bridge between Japan and China." Yet, under that bridge the waters appeared increasingly choppy. While the economic relationship between Japan and China had grown increasingly close, their political relations had not and some Japanese firms had begun to reassess their commitment to China. Would capital-rich Japan and capital-poor China find a way to transcend their troubled history? Could JAFCO Asia be a catalyst for cooperation, or would its managers find their own operations affected by rivalry between Asia's two most important countries? The mix of formal rules and informal practices that governed foreign private equity firms in China was complex. Opening an office in Beijing signified a renewal of JAFCO Asia's efforts to master these challenges and coincided with an acceleration of the firm's investments. But JAFCO's first years of engagement with China had not been notably successful, and without some fundamental changes, there was little reason to believe that the addition of a physical presence there would yield better results now.

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