Internalization theory best explains CEMEX’s FDI Essay

1.Which theoretical explanation (or explanations) of FDI go around explains CEMEXs FDI? 1.Internalization theory best explains CEMEXs FDI because CEMEX entered into many countries and bought domestic cement backupes instead of licensing. CEMEX has a ample system and needs to protect it from competitors.2.What value does CEMEX bring to a host economy? Can you follow any potential drawbacks of inward investment by CEMEX in an economy? 1.The value is that CEMEX has a Midas dapple that transforms a cement business into a thriving business. This brings great stimulation to the host economy and overly helps in the construction field, which in turn helps to build cities and civilization. No, CEMEX would do well to invest inwardly, yet, CEMEX is better at acquisitioning businesses.3.CEMEX has a strong preference for acquisitions over greenfield ventures as an entry mode. Why? 1.Acquisitions are solid because the business in the host economy already knows the demographics and the market . CEMEX just has to make the business better with little research. A greenfield venture would prove risky and not cost effective.4.Why do you think CEMEX decided to exit Indonesia by and by failing to gain majority learn of Semen Gresik? Why is majority control so definitive to CEMEX? 1.A licensing is very dangerous. CEMEX only have a 25% push with Semen Gresik. It did not have abundant control and the methods of CEMEX would be exposed and vulnerable to be stolen. CEMEX has a great system and does not want anyone interfering.5.Why do you think 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? 1.Indonesian politicians did not like the possibility of CEMEX taking over the cement market. Their interests were in domestic businesses and protect the purity of their economy. No, Indonesia would have benefitted greatly if CEMEX was allowed an in.6.W hat is CEMEX doing nowadays? Do they still engage in FDI? 1.MONTERREY, MEXICO- OCTOBER 8, 2010 CEMEX (NYSE CX), announced today that pursuant to the exercise of a put option by Ready Mix regular army it get out acquire its partners interests in the two joint ventures between CEMEX and Ready Mix USA which hav