Aggravating On the other hand, the restrictions and limits when doing business in China cannot be neglected. China Imposes tariffs and restricts foreign countries to certain sale regions which limits the opportunities of Intel to expand. Furthermore, China required some companies to enter Joint ventures with Chinese companies In the past. This might lead to unfavorable contracts with companies which do not fit In the general concept of Intel. But in my opinion, the advantages outweigh the disadvantages. From all the potential locations Dahlia seems to be the most favorable one.
India for example still has to deal with an unstable government and with slow progress on much-needed economic reforms. In addition, the infrastructure of India is still under-capitalized which makes the supply of important items difficult. Fraud and corruption are still wide spread In Vietnam which makes it nearly impossible to do business there. As In India, the governmental situation Is not stable as well. Besides, Thailand has to deal with natural disasters s Question 2: Where would you build the new plant? Why? I personally prefer China. The first and most obvious reason why to choose China are he low cost.
Low labor costs in combination with an ambitious and well educated workforce provide huge cost saving potential. Moreover, Intel has already experience in doing business in China since the company has already built several plants in Shanghai and Changed. In addition, the rapidly expanding industrial complex offers many opportunities to fix advantageous contracts with suppliers and beneficial cooperation with other companies. In contrast to other locations in Asia, the infrastructure In China Is good which ensures the supply of Important Items. Besides,
China offers tax breaks which represents a huge cost saving potential as well. Be neglected. China imposes tariffs and restricts foreign countries to certain sale required some companies to enter Joint ventures with Chinese companies in the past. This might lead to unfavorable contracts with companies which do not fit in progress on much-needed economic reforms. In addition, the Infrastructure of India Is still under-capitalized which makes the supply of Important Items difficult. As in India, the governmental situation is not stable as well. Besides, Thailand has to deal with natural disasters such as flooding.
The disadvantages in China are not as serious as in the other countries, in my opinion. Question 3: If you were Intel, what would you ask from the government of your chosen location? Why? I would ask for tax break for the first few years during the construction of the new plant. In addition, I would try to convince China to loosen their restrictions and barriers to certain areas. Furthermore, I would try to find out more about the Joint ventures with Shines companies and I would definitely not sign a contract which includes an obligation of a Joint venture with a Chinese company without my agreement.