Tugas Bisnis Internasional Financial Forces

TUGAS BISNIS INTERNASIONAL
FINANCIAL FORCES
Disusun oleh :
Ni Made Ayu Mulyani 1815744013 (01)
Agustina Putri Lisnowati 1815744023 (03)
3C MBI
TAHUN AJARAN 2019/2020

ADMINISTRASI NIAGA
MANAJEMEN BISNIS INTERNASIONAL
POLITEKNIK NEGERI BALI
Financial Forces
Financial forces greatly affects international business and can change the world economy
including foreign exchange rate risk, national balance of payments, taxation, tariffs, fiscal and
monetary policies, inflation, and international business accounting rules.
1. Fluctuating Currency Values
fluctuations in the value of a currency are the fluctuations in the price of one currency compared
to other currencies. The price change is caused by demand and supply in the market for that
currency compared to other currencies. If you hear news about the fluctuating value of the
Rupiah against the US Dollar, then that means prices are moving, can go up or down, due to
transactions involving both currencies.
Fluctuations in the value of world currencies are influenced by several factors:
• Too large imports of a country that are not balancing with exports that affect foreign exchange
reserves must be paid at the exchange rate of US $
• Excessive buying and selling of foreign currencies above US $ in foreign exchanges so that the
State is in a deficit
• Limit foreign currency quotas in each country.
2. Foreign Exchange
Foreign exchange is a currency that is recognized, used and also accepted as a means of payment
in international trade. The widely used foreign exchange is usually the currency of a country that
has a significant role or control in the economic system throughout the world. In the entire world
itself, the most widely used foreign exchange is the Dollar.
Foreign exchange is part of a country's foreign exchange. The foreign exchange itself is any
wealth that is owned by a country residing abroad whose form can be in the form of goods,
services, or even currencies that are used as a means of cross-country trade transactions. Foreign
exchange of a country in the form of this currency is what we often refer to as the foreign
exchange.
Dollar As a Main Currency
An indication of the tendency to use US $ as the main foreign currency payment instrument:
• is a foreign exchange reserve of many countries
• is a vehicle currency that is used for international trade or investment
• Is a currency used for intervention (intervention currency) of a country in intervening in the
foreign exchange market, by buying US $ to strengthen its currency.
• As a security aspect (safe haven) concerning the US dollar the political concept is very
influential compared to most other countries to have a communist government undergoing a
revolution or military coup
3. Exchange Rates
• Spot Exchange (spot rate) is the exchange rate between two currencies for immediate trading
with a delivery period of two active business days.
• Forward Exchange (forward rate) The exchange rate is today's price for a commitment by one
party to hand over or take from another party, an agreed amount of a currency, at a future date
that has been determined.
• Cross Exchange (cross rate) direct exchange rates that occur between non-US $ currencies; It is
usually determined by comparing the exchange rate of US $ from other currencies.
Exchange Rate for June 19 and June 16, 2006
4. Tariffs and Taxes

The word tariff and customs have almost the same meaning and are usually a tax on imported
goods. The amount of tax can be high or low, and companies need to minimize it. Lower tariffs
are one factor that a country will consider when deciding whether to join a group of nations, but
it is not the only factor.
Taxation
Because many international businesses are carried out by companies operating in corporate form,
here the rates and taxes levied on corporations must be considered. It can be said that
corporations do not pay taxes, but only collect taxes from the public. In the end, it is the people
who pay taxes. International companies must pay more attention to taxes because these
companies deal with more countries.
a. Taxes Are Different In Different Countries
In almost all countries, income tax is the largest government revenue. Then there is a sales tax or
value-added tax on goods and services, a tax on capital gains, property taxes, and social security.
The company must study the tax laws of each country in which the company operates which will
show how tax differences affect policies and rules in the Country.
Inflation is the phenomenon of rising prices for all goods or services in a certain period followed
by a decrease in people's purchasing power.
b. Influence of inflation on interest rates
Inflation is a factor of external financial strength that must be faced by all companies, sometimes
must borrow money, and the inflation rate determines the real cost of loans, real interest rates are
obtained by subtracting inflation from nominal interest rates. When loans are returned in the
future in the future after inflation occurs, the money will be lower for the lender, and certainly
cheaper for the borrower
c. Monetary and Fiscal Policy Affects Inflation
Countries implement their fiscal and monetary policies in such a way as to cause an increase in
inflation. Successful policies have two things:
The policy eliminates artificial economic controls, such as wages and price controls
The policy implements fiscal and monetary controls, these controls include lower taxes and
slower money supply growth.
d. The importance of inflation for business
High inflation rates make it difficult to plan capital expenditures. For example, management
might allocate the US $ 1 million to a factory but was forced to spend more funds to complete its
construction because of the influence of inflation. High levels of inflation led to a loan (debt)
because the loan will be paid back with more money low value, but high inflation also inhibits
lending.
e. Inflation and International companies
Inflation also affects international business, with the complication that inflation rates differ in
different countries. Management of international companies must try to predict the inflation rate
for each country where the company is located, the comparative inflation rate will affect the
value of comparative currencies when the currency of a country with a level High inflation
weakens the currency with a lower inflation rate. Higher levels of inflation will result in the price
of goods and services produced or offered by a country increasing and thus these goods and
services will become less competitive.
f. Poorness Index
The term misery index (misery index) began to be used in the politics of the United States during
the presidential election campaign in 1980, when both inflation and unemployment were high.
The index is a sum of simple unemployment and inflation rates and is a kind of indicator of
economic success: the higher the value the lower the poverty.
5. Accounting Practices
Each country has different accounting practices from other countries. If an international
company is dealing with branches abroad, then the international company must be prepared to
follow the rules of accounting practices in a country of origin, in accounting practices used in the
country of origin must be understood by the public, investors, and government officials from the
country of origin of the international company in purpose.
6. International Banking
This can be seen in the WTO. One of the requirements for WTO membership is that member
countries must open their banking systems to foreigners.
7. Household Savings
Household savings are important because they allow capital creation for new investments. When
people save, banks and other lenders have more money for loans. Savings as a percentage of net
income after tax is a good measure of the level of savings in a country.
Debt Solution
• Short-term Solutions
How to deal with short-term debt problems involves rescheduling debt payments to countries
that cannot afford to pay the due date. But renegotiation has become increasingly difficult, BIS,
commercial banks, and central banks are reluctant to disburse even more loans because IMF
resources are limited
• Long-term Solution
Debt re-negotiation accompanied by a strict austerity plan program is part of the first stage of the
world's efforts to solve the debt problem, this stage causes a deterioration in living standards and
limits economic growth and exports. will not succeed.

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TUGAS BISNIS INTERNASIONAL

TAHUN AJARAN 2019/2020

4. Tariffs and Taxes

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