Apple has been barred from selling their latest iphone 6s/6s+ because the design is similar to another one in Beijing. I find it odd that China would award intellectual ownership of the iphone to another company that wasn’t the original creators of the idea. This is a perfect example of why there are a lot of barriers of entry into a new environment.

http://www.wsj.com/articles/beijing-regulator-orders-apple-to-stop-sales-of-two-iphone-models-1466166711

https://next.ft.com/content/c038cad6-3476-11e6-bda0-04585c31b153

Nigeria capital controls and fixed exchange rate was not aligned with the changing micro and macro economic situation. Nigeria depend on the price of oil to effectively manage its economy and since the oil price collapsed. The fix exchange rate eroded the central bank ability to mange the changing fortunes of the  independence of the Central Bank of Nigeria. The fix exchange rate benefited the poor at the expense of the export business sector of the economy.  The fix exchange rate accelerated capital fly.

http://www.nytimes.com/2016/06/17/business/international/disney-shanghai-opens.html?_r=0

The online version of this article came with a brief video showing interviews with guests at the soft opening of Shanghai Disneyland. It was interesting to see how they equated their nationalism with the Shanghai Disney experience. Some guests were really excited that they had a particular ride that other Disney parks didn’t have. Older guests who could not travel far were happy to have the Disney experience close to home. They definitely reveled in having the largest and tallest castle Disney ever built.

The article also mentions how this opening came without the cultural missteps that accompanied the openings in France and Hong Kong. The tremendous amount of planning and research that went into the creation of this park was addressed but also how there were issues that could not be determined until the actual opening. CEO Robert Iger is quoted as being surprised by the amount of “American” food being consumed and men buying and wearing Mouse ears. He also  spoke to a issue with a ride requiring guests to paddle a canoe; a process which was lost in translation.  There is also “American” food with a “distinctly Chinese” flavor such as Peking duck pizza and turkey legs with hoisin sauce. Again they catered to the Chinese people by having  a “strong intergenerational appeal” and areas designed for older guests.

I find it pleasing that Disney has clearly learned from its mistakes in the past. They invested a lot of time and money establishing a positive relationship with the Chinese government. One which even President Obama lauds as capturing “the promise of our bilateral relationship”. Disney also found a neat balance of global standardization and local adaptation that seems successful from the outset. It remains to be seen how this develops and adapts as more people visit the park.

http://www.businessinsider.com/nigeria-devalue-naria-2016-6

Nigeria is finally going to do the painful thing everyone said it has to do.
The central bank announced on Wednesday that the naira peg will be abandoned on Monday, June 20, and the currency will be allowed to float freely. Although, Central Bank of Nigeria Governor Godwin Emefiele also said that the bank will intervene “as the need arises.”

As for what this means for Nigeria’s economy, in the short-term it’s going to get ugly. But in the long-term, things should start to pick up. Over the long-run, a weaker currency will help Nigeria’s economy by encouraging import substitution and attracting foreign investors, who have shunned the country for fear of a devaluation.

But the move will be painful over the short term. Higher import prices will add to inflation, which reached 15.6% y/y in April. This will probably force the authorities to tighten monetary policy,” he added.

Plus, if Nigeria’s central bank can’t get inflation back under control, then the country might end up getting stuck in a “vicious” cycle of high inflation that leads to a weaker naira, noted Marc Chandler, the global head of currency strategy at Brown Brothers Harriman. And that, then, could lead to higher inflation.

“This is one reason why devaluations can be so painful, as central banks typically jack up interest rates afterwards. Recessions are often seen post-devaluation,” he wrote. “Yet if Buhari has finally relented on maintaining what we viewed as an unsustainable peg, the longer-term outlook for Nigeria will have improved.”

Analysts have long been arguing that Nigeria will eventually have to capitulate and devalue its currency given that the government’s controversial agenda of currency and price controls created a bunch of economic stresses in Africa’s largest economy. Most recently, inflation soared to a six-year high.

Still, devaluing the currency peg will not magically fix all of Nigeria’s problems.

The country continues to suffer from numerous headaches, including lower oil prices, the fuel-shortage crisis, and ongoing oil-production disruptions by the Niger Delta Avengers. Plus, the Nigerian Bureau of Statistics recently revealed that the country’s economy shrank by 0.4% year-over-year in the first quarter, which was way worse than expected.

“A weaker currency is, at best, a necessary but insufficient condition of an economic recovery,” concluded Ashbourne.

But at least it’s a step in the right direction.

http://www.wsj.com/video/shanghai-disney-resort-opens-gates/80C12B8B-21D8-4CE9-B94F-6CA499230E81.html

Just read article in Wall street Journal  today about Disney opening its gates to its first resort in mainland China after years of planning and spending almost $5.5 billion so far in infrastructure. We discussed this issue 3 weeks back in the class about Disney’s issues in Europe and whether it will succeed in China.

While opening its operations in China, Disney has been in limelight here in US for variety of wrong reasons. This week on Tuesday,  a 2-year-old-boy was killed at Florida’s Walt Disney World Resort when an alligator dragged him into a lake.

It will be interesting to see whether and when Disney starts making money in China in view of recent slowdown in Chinese economy and uncertainty in Europe over BREXIT.

Officials are expecting 60,000 visitors daily and still may not break even for years. More than 10 million visitors are expected in the first year of operations. There were long lines and 40 minutes of wait time.

http://www.bloomberg.com/news/articles/2016-06-15/airbnb-makes-case-for-home-sharing-in-japan-as-regulation-looms

On the heels of our guest presenter last week and our spirited discussion regarding Uber, I though this article addressed many of the same issues Mr. Caine raised. Unlike Uber, however, Airbnb seems to be following Mr. Caine’s line of thinking and it sees engaging with the Japanese government openly and proactively as an opportunity to shape its presence in that country.  The final paragraph struck a decidedly positive tone and one I imagine Mr. Caine would support:

““We are very encouraged and excited by the approach the Japanese government is looking to take thus far,” said Lehane… “It can be a model not just for Asia, but potentially a global model.”

Saturday’s presentation was interesting in relating many of the class concepts to the speaker’s experience and research.  One thing I would have liked to hear more about is the role of culture in a multinational’s expansion and success in a new international market.  This article speaks to many of the governmental and legal  obstacles that led to Google’s failure and eventual withdrawal from China, but also mentions the many cultural mistakes the company made along the way.

American’s assume that all countries’ governments and cultures are as interwoven as our own if not more (as they are in China).  There are many countries, however, that that the two often behave independently of one another.  In Europe Italy is a good example of the public’s relatively low attachment to political figures and ideologies, the same being true in much Latin America.  Companies seeking markets in such countries are better suited gaining the support of influential cultural icons rather than supposedly powerful government officials or lobbyists.  Uber generated legions of vocal fans among its users who acted as governmental lobbyists; a strategy that proved to be a far cheaper and faster way of building business than wading through years of litigation and policy reform in each new market.

I also would have liked to hear about the speaker’s reflections on multi-nationals’ evolution in the last two decades since the passing of the anti-bribery bill.  Most emerging and developing markets have ingrained processes of corruption built into their economic and political systems; How has big business been able to navigate these since the reforms? Are there advantages to such systems?  I contend that many American and other developed global companies quietly prefer such markets, particularly those involved in natural resources.  How would the BP oil spill have affected the company if it had occurred off the shores of West Africa and not the United States??

Who knew that in some parts of the world Cash on Delivery would be growing in it’s popularity.  I found this to be contrary to everything that is the norm for me, especially since my memory of finding out what CoD was stems from my youth and seeing a commercial for a new invention where they mentioned that you can pay CoD.  Even then the thought of having something delivered and paying for it when it gets to you sounded ideal, but to see it growing in popularity in a place like India that has such a large population is very interesting.

http://www.nytimes.com/2016/06/15/business/international/china-disney.html

I found this article interesting (Only focused up to “Mickey in the land of Mao”) because it directly relates to the discussions we had in class and it shows how difficult it can be to continue expanding into new markets. In the case we read we saw how Disney at the time faced a dilemma on whether to remain true to the “Americanized” version of what Disney represented vs. modifying it to the local culture in one way or another in order to draw in customers. One specific quote from this article that caught my attention said, “Worried that importing classic rides would reek of cultural imperialism, Disney left out stalwarts such as Space Mountain, the Jungle Cruise and It’s a Small World. Instead, 80 percent of the Shanghai rides, like the “Tron” lightcycle roller coaster, are unique, a move that pleased executives at the company’s Chinese partner, the state-owned Shanghai Shendi Group, who made multiple trips to Disney headquarters in California to hash out blueprint details.” Contrary to Disney’s initial resistance in Europe in allowing the sale of alcohol in their theme parks in order to keep the same culture found in the U.S, leaving out key rides really caught me by surprise. It will be interesting to see how Disney performs in this market. They are set to open in just two days, June 16, 2016.