Cemex

QUESTION 3 Read the management Focus on Cemex and consequently answer the following question: a. Which theoretical explanation, or explanations, of FDI best explains Cemexs FDI? b. What value does Cemex bring to a host prudence? Can you see any potential drawbacks of Cemexs inward investment in an economy? c. Cemex has a strong taste for acquisition over greenfield ventures as an entry mode. why? d. Why do you find Cemex decided to exit Indonesia after failing to gather in mass control of Semen Gresik? Why is majority control so important to Cemex? e. Why do you mobilise politicians in Indonesia tried to block Cemexs attempt to gain majority control over Semen Gresik? Do you think Indonesias best interests were served by limiting Cemexs FDI in the country? Answer: a. The theory that best explains Cemexs abroad direct investment (FDI) activity is that of internalization due to limitations of licensing or also known as the market imperfection approach.

Cemex valued to expand horizontally because it trusted to reduce its reliance on its home market and provide some stability in the demand for their product. Also, they saw opportunities abroad and it could provide their service, which required construct very personal relationships with the distributors and the builders themselves. Lastly they had spent a smoke of time working on their information technology clay that allowed them to control their supply and it was part of their competitive advantage. Due to their preposterous personal line of credit model, they would not be able to get the selfsame(prenominal) value by licensing their business thus they had to internalize the business abroad and directly set up business abroad. b. If you want to get a full essay, order it on our website: Orderessay

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