Location advantages (or country specific advantages)
a. Economic advantages consists of the quantities and qualities of the factors of production, transport and telecommunications costs, scope and size of the market。
b. Political include the common and specific government policies that influence inward Foreign Direct Investment flows, intrafirm trade and international production.
c. Social, cultural advantages include psychic distance between the home and host country, language an cultural diversities, general attitude towards foreigners and the overall position towards free enterprise.
1. Diplomatic, culture & economic relations: ...view middle of the document...
China is Germany's second largest trading partner outside of the European Union, after the United States. The trade volume between China and Germany surpassed 100 billion U.S. dollar in 2008.
2. Political advantages: The local courts provide European customers and suppliers with more legal protection than if business were to be conducted in Hong Kong or China.
3. Economic advantages: The most significant economic unit for Hamburg is the Port of Hamburg, which ranks 2nd only to Rotterdam in Europe and 9th worldwide with transshipments of 9.8 million twenty-foot equivalent units (TEU) of cargo and 134 million tons of goods in 2007. After German reunification, Hamburg recovered the eastern portion of its hinterland, becoming by far the fastest-growing port in Europe. In addition, German employees with high education level and its high level of technology will provide Baosteel great opportunities and advantages. Moreover, Germany’s advanced automobile industry provides Baosteel a broad market and significant market demands.
1. Social, cultural advantages: Italy and China built diplomatic relationships over 40 years ago. The bilateral trade between the two countries has been increasing fast as a result of the joint effects of the governments and business circles of the two countries. In 2011, bilateral investment has been developing greatly, with investment from Italy to China increasing by 42% year-on-year, while investment from China to Italy doubled the total volume of 2010. Moreover, Italy’s business culture is similar to China’s. As same as Chinese do, Italians take a great attention to family relationships and network relations. As a result, many of the Italian companies are family companies. This cultural similarity can help Baosteel develop in Italy and Europe more fluently, with less conflicts with local...