PROJECT - Foreign Direct Investment & Country Risk
Assume that you are a business analyst for an international investment bank. You are asked by your manager to conduct an analysis for Pluto-M (P-M), a domestic medical and health corporation with experience in setting up and operating private retirement homes in its home country. P-M seeks advice from your bank as to whether it should expand internationally by establishing a private retirement home business in a suitable foreign country.
Based on suitable analysis of this foreign country*, what advice will you offer?
(Note: This is a project on country risk. The chapters on foreign direct investment and country risk in the recommended textbooks are useful, but you are also expected to undertake significant further research for this project.
You should start work on this project as soon as possible. * You are free to choose one suitable country for your analysis and advice.
Your analysis/advice must include all of the following sections and you should discuss most or all of the given factors, for the chosen country:
1. The nature of the retirement home market - including demand, few or many competitors and their relative sizes, and cost factors.
2. The country situation - including e.g. rules for FDI, government policies and incentives, demography (many old people?), location of the private retirement facility, sources and quality of inputs including skilled labour, proprietary technology and intellectual property issues, and briefly, types and degree of financial and political risks.
3. The most appropriate type of FDI for companies in the retirement home industry to minimise risks - e.g. consider a joint venture or a wholly-owned subsidiary, and include a brief consideration of ethical and socially responsible corporate behaviour.
4. A set of clear advice for M-M, including clear and detailed recommendations linked explicitly to 1, 2 and 3 above. Your project should be written in BUSINESS REPORT FORM.
Use the 4 sections given above to structure your report.
Your report should also include an executive summary, be TYPED and NO LONGER THAN 2,000 words.
You will be assessed on your:
1. Notes and Bibliography: Is the project well referenced? Is the citation system consistent? Do all sources cited in it appear in the bibliography? Does the bibliography contain all necessary details? Penalties will be imposed on plagiarists.
2. Presentation and Grammar: Is the presentation of an appropriate standard? Is it the required length? Are there numerous spelling, grammatical or punctuation mistakes?
3. Evidence of research, and sophistication and originality of arguments: Is there evidence of extensive research? Are the arguments sophisticated and original or are they mainly reproductions of arguments from existing literature?
4. Clarity of the argument, strength of analysis, and ability to use and integrate sources: Is the writing well structured and integrated? Does the argument flow logically? Are arguments supported by evidence? Are there any sweeping generalisations or unexamined assumptions?
You are free to discuss the project with other students but you must write up your project individually. Severe penalties (up to 20 points, i.e. 100% of the full mark of the assignment) will be imposed on students for plagiarism.
A fair amount of research is expected for this project and students are advised to start collecting material for their project as soon as possible.
2000 words
8 references