UNIVERSITAS SEBELAS MARET

INTERNATIONAL BUSINESS
FINAL EXAM (FEB - JUNE 2018)

NAME : ALODIA PANDORA

MATRIC NUMBER : 20

Answers:

1. Dewi Soeharto Legal Partnerships (DSLP) and Assegaf Hamzah & Partners (AHP) are
officially merged. This merging process is aimed at strengthening human resources and
enhancing the role in completing intellectual property practices in Indonesia. The merger of
two big law firms is in the spotlight of many parties and considered a strategic step in
solving intellectual property problems problem in Indonesia. The merger of these two law
firms would be a major force in the field of International Property Rights settlement dispute.
AHP itself is included in the ranks of Indonesia's largest law firm with approximately 130
advocates including 22 partners. All this time AHP is a law firm in the field of mergers &
acquisitions, banking and projects, infrastructure, competition, technology, and technology.
DSLP is the most trusted intellectual property law firm. The law firm was established in
1996 and has been focusing on intellectual property practices since 2007. DSLP provides
comprehensive intellectual property services, including copyrights, trademarks, patents,
industrial designs, spatial plans, integrated circuits, endeavors of various types of protection
and secrecy trade. Currently, DSLP consists of 4 lawyers of which are 3 of them licensed
HKI consultants and 1 paralegal. DSLP is notoriously selective and has a high ability to
provide the best IPR legal services that make many big companies and social institutions
choose to use their services over the years. So, more resources and thinking are needed.
DSLP chose to join AHP whose partners are well known.
New firm will have an increased market share, which helps the firm gain economies of
scale and become more profitable. The merger will also reduce competition and could lead
to higher prices for consumers. Mergers can help firms deal with the threat of multinationals
and compete on an international scale. This is increasingly important in an era of global
markets. Mergers may allow greater investment in R&D This is because the new firm will
have more profit which can be used to finance risky investment. This can lead to a better
quality of goods for consumers. This is important for industries such as pharmaceuticals
which require a lot of investment. It is estimated 90% of research by drug companies never
UNIVERSITAS SEBELAS MARET
INTERNATIONAL BUSINESS
FINAL EXAM (FEB - JUNE 2018)

comes to the market. There is a high chance of failure. A merger, creating a bigger firm,
gives more scope to tolerate failure, encouraging more innovation.
2. Advantages and Disadvantages of Joint Venture
A major joint venture advantage is that it can help your business grow faster, increase
productivity and generate greater profits, include: access to new markets and distribution
networks, increased capacity, sharing of risks and costs with a partner, access to greater
resources, including specialised staff, technology and finance. Partnering with another
business can be complex.
Disadvantages of joint venture can be significant, especially if you form a relationship
with a business whose abilities or resources don't match or complement yours. This is the
risk of joint venture: the objectives of the venture are not clear and communicated to
everyone involved, the partners have different objectives for the joint venture, the partners
bring in different levels of expertise, investment or assets into the venture, different cultures
and management styles result in poor integration and co-operation, the partners don't provide
sufficient leadership and support in the early stages.
Advantages and Disadvantages of Contract Assembly
A contract assembly may offer cost advantages over a company’s internal production
facilities. The assembly may, for example, be based in a country with low labor costs. Some
contract assembly specialize in specific types of products, setting up high-volume
production lines that allow them to produce products at a low unit cost. A company can also
obtain a cost advantage by outsourcing production rather than investing expensive capital in
production equipment and hiring skilled labor. Although companies may gain an apparent
cost advantage by using a low-cost contract assembly, they must also consider the additional
costs of dealing with an outsourcing partner. A company using a contract assembly in a low-
cost country, for example, may incur shipping costs that cancel out any unit cost advantages.
The company may also have to appoint staff to manage and monitor the performance and
quality of the contract manufacturer. A company can gain significant operational advantages
by using contract assembly. If demand for products increases, for example, a company can
hire additional production capacity to meet short-term demand without investing in its own
facilities. Companies developing new products can use contract assembly to produce pilot
UNIVERSITAS SEBELAS MARET
INTERNATIONAL BUSINESS
FINAL EXAM (FEB - JUNE 2018)

runs for test marketing before setting up full-scale production facilities. Companies can also
improve the quality or performance of their own products by outsourcing production of
components they cannot assembly with their own resources.
Although there are important operational advantages, companies must also be aware of
potential risks in contract assembly. Loss of control is a major challenge. Contract assembly
may not be able to maintain production schedules or meet agreed quality standards,
particularly in distant locations where day-to-day control is impractical. Contract assembly
specializing in particular types of products may work for a number of companies that are
competitors, increasing the risk of losing sensitive commercial or technical information.
3. Foreign direct investment (FDI) and trade are often seen as important catalysts for economic
growth in the developing countries. FDI is an important vehicle of technology transfer from
developed countries to developing countries. FDI also stimulates domestic investment and
facilitates improvements in human capital and institutions in the host countries. Even though
past studies show that FDI and trade have a positive impact on economic growth, the size of
such impact may vary across countries depending on the level of human capital, domestic
investment, infrastructure, macroeconomic stability, and trade policies.
In the Asia-Pacific region, if measures are taken by high-tariff countries to reduce their
tariff levels to the developing country average, a 6 to 7% increase in FDI inflows to the
region can be expected. Moreover, reducing other types of trade costs in high-cost countries
in Asia-Pacific to the developing country average, such as logistics costs or those associated
with cumbersome import or export procedures, can be expected to increase FDI flows by
20%.
In turn, a moderate improvement in the quality of the domestic business environment in
the host country by just 10% on average across the Asia-Pacific region would increase
regional FDI flows by over 60%. Improving liner shipping (maritime) connectivity of
underperforming countries in the sample to the developing country average would also
significantly increase FDI, but this would likely require massive investment in maritime
infrastructure in many countries.
Overall, the analysis fully supports the view that trade facilitation should be a core
component of any foreign direct investment development strategy and provides further
UNIVERSITAS SEBELAS MARET
INTERNATIONAL BUSINESS
FINAL EXAM (FEB - JUNE 2018)

evidence of the benefits associated with enhancing trade efficiency, if FDI want to have a
beneficial impact, it is important to increase absorption capacity, by increasing human
capital accumulation, increasing and improving transport infrastructure, improving market
access for poor countries to increase trading opportunities, and facilitating trade between
developing countries. Mayer also calls for more detailed examination of the impact of
investments in infrastructure and in education and the interaction with the benefits from FDI.

References

American Journal of Agricultural Economics, Volume 86, Issue 3, 1 August 2004, Pages 795–
801,

Owen Brader, The impact of Foreign Direct Investment in developing countries

http://www.hukumonline.com/berita/baca/lt5b18df0a0b816/perkuat-bidang-hki--dua-firma-
hukum-ini-resmi-merger

https://www.nibusinessinfo.co.uk/content/joint-venture-benefits-and-risks

https://bizfluent.com/info-8503681-advantages-disadvantages-contract-manufacturing.html