The document discusses several topics related to international business. It begins with definitions of international business and multinational companies. It then summarizes information about The Coca-Cola Company, including its founding, products, market share, and global operations. It also provides overviews of the International Finance Corporation (IFC), Multilateral Investment Guarantee Agency (MIGA), and British Petroleum, describing their roles in facilitating and insuring international investments and businesses.

1. International Business

2. Introductions
International business refers to all the commercial transactions that take place between two or more
countries, nations, and regions beyond their political boundaries. It can be noted that there are several
parties involved in international business with different objectives. Private organizations involved in
international business with the profit motive and some organizations helps to international trading by
providing help and support to the governments and private organizations.
Multi National Companies/Enterprises (MNC)
Multinational company (MNC) or Multinational enterprise (MNE) is an organization that manages
production or rendering in several countries. According to the definition of “International labor
organization”, Multinational Company is an organization whose headquarters is located in one country
which is known as home country and performs is operational activities in different countries all around the
world which are called host countries”.
The Coca-Cola Company
Founded by Asa Candler in 1892 the Coca-Cola Company’s headquarters is situated in Georgia, United
States. Subsequently taken over by Asa Candler in 1889, The Company’s main product was discovered
by Pharmacist John smith Permberton in 1886. The company is involved in manufacturing, retailing and
marketing of non alcoholic beverages and syrups. “Coca-Cola” remains as the company’s flagship
product since its inception which contributes to approximately 78% of the revenue of the company.
Currently the company is listed in New York Stock Exchange (NYSE). Apart from its flagship brand the
company involved in manufacturing of around 500 brands in the form of 3500 products covering over 200
countries across the world. Most of these other brands also remains in the leading positions among the
world’s most valuable brands.
The products of the company can be categorized as follows,
 Soft drinks
Coca-Cola, Diet Coke, Coca-cola Zero, Fanta, and sprite
 Juices/Juice drinks
Minute Maid, Bright & Early, Fuze, Simply apple, simply grapefruit etc
 Energy drinks
Gladiator, Burn
 Sports drinks
Powerade, Power Zero
 Water
Ciel, Dasani, Smart Water and Bonaqua
 Teas
Honest tea, Sokenbicha and Marocha
 Coffee
Georgia coffee which is the best selling soft drink in Japan
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3. According to the information released by the company, at the inception in 1886 the company sold 9 drinks
per day and in 2011 it has reached1.7 Billion drinks daily. The company holds 42% market share in US
carbonated soft drinks market while the main competitor, PepsiCo holds 29%. In 2010 coca-cola has
become the first brand to reach 1 billion pounds of annual grocery sales in UK. As per the information
released by the company the sales of the company has distributed across the world in the following
manner.
Region Sales %
Latin America 27%
North America 24%
Europe 17%
Pacific 17%
Asia and Africa 15%
According to the survey conducted by Interbrands, the company’s flagship brand “Coca-Cola” remains in
the first place having a value of $ 71,861 Million.
Therefore it is clear that Coca- cola is benefitted through the international businesses. The Company
started expansion of its operations to outside US in 1906 with the expansion of its operation in to Canada,
Cuba, panama and France. From 1906 to up to date Coca Cola is expanding its global operations day by
day by expanding its products in to more countries and regions. The Coca Cola Company started building
its global network in 1920s after identifying the potential market outside its home country, United States.
With the global approach of the company employed more than 100,000 employees all around the world.
As a part of its international operations, the company took steps to initiate “Haiti Hope” project to develop
Haiti after the devastating earthquake.
International Business –Business Imperative Page 3

4. International Finance Corporation
International Finance Corporation (IFC) is a one of the four development institutions of World Bank and is
owned by more than 179 countries whose share holders of the IFC. In 1950 with the inception of World
Bank it was proposed to initiate an organization to encourage private sector investment in the World
Bank's borrowing countries. With such proposal the United State government proposed to establish "an
International Finance Corporation" as an affiliation organization to world Bank. It would finance private
enterprises in developing countries but:
 Taking no government guarantees
 Always work with other private investors
 Never manage its investees/Borrowers
Incorporation of IFC had major impact on the international business arena where organizations/countries
can do their business with less risk.
The vision of the IFC is,
“People should have the opportunity to escape poverty and improve their lives”
The purpose of the IFC is to create opportunity for people to escape poverty and their lives by,
 Promoting open and competitive markets in developing countries
 Providing support to companies and other private sector organizations
 Helping to create productive jobs and provide essential services to the communities whose
needs were not fulfilled.
 Creating and making available other sources of finance for private enterprises to develop those
enterprises.
IFC mainly provide following services,
 Investment services
IFC investment services offer vast range of financial products to worthy enterprises and
encourage entrepreneurship. Under this service IFC provides following financial products to
private investors,
Loans
IFC provides fixed and variable rate loans for its own account to private sector projects around
the world. Such loans are called “A loans”. These loans have a maturity period of 7to 12 years if
warranted by the project, IFC will grant long term loans which have tenure of 20 years. Since IFC
is a profit oriented organization it pays major attention in to the profitability of the projects and
market interest rates are charged for the financing facilities.
Syndication loans
Through Syndication loans, commercial and other financial institutions are offered to invest in
projects where IFC will also invest where otherwise such banks and investors will not consider
otherwise.
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5. Equity Finance
IFC invests in equity capital of private commercial banks and other investment companies. IFC
makes equity investments in long term basis for a period of 8 to 15 years.
Quasi-Equity Finance
IFC also invests in capital which are having both equity and debt characteristics.
Equity and Debt Funds
IFC promotes private equity funds and debt funds in foreign markets where there are emerging
equity and debt market in developing countries by helping to establish equity and debt funds.
Structured Finance
IFC provides structured financing facilities such as partial credit guarantees, Risk sharing
facilities and securitization facilities to its member countries.
Intermediary services
IFC extends its investments in financial intermediaries such as private equity and
investment funds, leasing companies etc.
Risk management Products
IFC enters in to derivative products with private organizations to mitigate their financial
risks such as interest rate risk and foreign exchange rate risk.
Local currency financing
IFC provides local currency finance to private organizations in order to mitigate foreign
exchange risk.
Trade Finance facilities
Global Trade Finance Program is a program initiated by IFC to facilitate to commercial
bank operates across the globe to mitigate risks associated with trade related
transactions.
 IFC Advisory services
To help private sector IFC provides advisory, problem solving and training programs to
companies, industries and governments. In order to achieve its objective IFC provides advisory
services in following areas,
Access to Finance
Investment Climate
Sustainable Business
Public Private partnerships
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6. Multilateral Investment Guarantee Agency
Multilateral Investment Guarantee Agency (MIGA) is one of the members of World Bank Group whose
mission is to “promote foreign direct investment (FDI) into the developing countries in order to help and
support economic growth, reduce poverty, and improve people's lives”.
The agency was established in 1988 with the intention of insure public and private sector investments
from non commercial risks in developing countries. Backed by World Bank and developed and developing
countries helped to increase image of the agency in its operations in all around world. Members of MIGA
include 175 countries and the initial investment was amounted to US $ 1 Billion.
The main activity of MIGA is to helping developing countries by issuing guarantees for non commercial
risks faced by cross border investments. The Agency protect investors and lenders against risks such as,
 Risks associated with inconvertibility of currencies and restrictions on transfer of
currencies
In situation where investors incur losses due to the inability convert local currencies to hard
currencies or hard currencies to local currencies MIGA pays compensation In hard currency to
the investor or lender.
 War, Terrorism and civil unrest
Losses incurred by the investors due to the destruction, damage or disappearance of physical
assets of the investment or due to the interruption of the total business by war, terrorism and civil
disturbance. Temporary business interruption also considered in certain circumstances.
 Expropriation
Losses incurred by investors due to the government interventions that will result in deterioration
or loss of ownership of the insured investment will be covered by MIGA. In the case of block of
funds MIGA will pay the amount of funds blocked by the respective government and in the case of
equity shares compensations will be paid based on the value of the share computed on net
assets basis.
 Violation of contract by the governments
MIGA protects the investors from losses which they incurred due to the violation of contracts by
the government. It should be noted that in some situations MIGA will cover the contractual
obligations of government stipulated in the agreement.
 Non Honoring sovereign financial obligations
MIGA will protect investors from the losses they incurred due to the non honoring of sovereign
financial obligation due under irrevocable financial payments such as sovereign bonds etc by
respective governments. Compensation is based on the unpaid capital and interest amount.
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7. MIGA covers,
 Foreign Direct Investments
 Acquisitions of public entities
 New investments in to enhancement of capacity, introduction of new technology or restructuring
of existing projects
 Investments which are having high development potential and with the investors whose willing to
exercise its long term commitment to such project.
Since its inception MIGA has provided more that US $ 24 Billion for insurance for over 600 projects in
more than 100 countries. Its current guarantee portfolio is amounted to over US $ 9 Billion.
MIGA guarantee will not provide only a assurance but will benefitted investors and lenders by,
 Preventing harmful actions
Being a member of the World Bank Group and its relationship with shareholder governments will
help to provide additional leverage in protecting investments against non financial risks.
 Resolving Disputes
When a dispute arises MIGA will intervene to resolve the dispute before it reach to claim status.
 Accessing Funds
Investors are able to obtain project finance from banks and other financial institutions at lower
rates due to the recognition the project received from the guarantee provided by MIGA.
 Lowering Borrowing cost
MIGA Guarantee will help investors to obtain funds at low cost due to the low project risk.
 Increasing Tenors
MIGA is able to provide insurance coverage up to 15 year which will helps investors to obtain
more tenor when obtaining project financing.
 Providing environmental and social expertise
MIGA is capable of providing investors and lenders with world’s best social and environmental
policies and practices.
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8. Oil and petroleum Mining Company
Among other multinational companies, Oil and petroleum companies act a main role in international arena
since the impact to the global economy by the petroleum companies are very high.
British Petroleum Corporation
British petroleum Corporation PLC (BP), whose shares are listed in both London Stock Exchange and
New York Stock Exchange, is global oil and gas giant operates in more than 80 countries across the
globe and headquarters is situated in London, United Kingdom.
Compared by the revenue, BP is the third largest energy company and fourth largest company in the
world. Among the six oil and gas sumpermajors, BP is also listed as one company out of six.
BP carry out its operations in more than 80 countries across the globe producing approximately 3.8 Mn
oil equivalents per day and operating more than 22,000service stations across the globe.
Inception of the BP is rooted to 1909 with the inception of Anglo –Persian Oil Company to explore the oil
in Iran and in 1954 it becomes British Petroleum and currently listed in two stock exchanges. The
operations of the company is falls in to the following categories,
 Exploration and production of oil and gas
The main task of this division is to discover, production and transport of oil and gas to the markets
where BP is carry out its operations. This division operates more than 30 countries employs more
than 20,000 employees.
 Refining and marketing of oil and gas
The main task of this unit is to supply, trading, refining, marketing and transportation of oil, gas and
petroleum products.
 Air BP
This unit focused on providing of aviation fuel to the air lines and providing other lubricants and
services required by air line services. This division operates in more than 50 countries across the
world.
 BP shipping
This division provides the logistic service to transport BP products to the markets across the globe.
This division manages large fleet of vessels which can transport Crude oil, Liquid natural Gas and
liquid petroleum gas.
The main brands of BP are,
 ARCO
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9. BP uses this brand as its retail brand as United States west coast in seven states (Viz, California,
Oregon, Washington, Nevada, Idaho, Arizona, and Utah).
 ARAL
As part of its global approach “ARAL” operates in Germany and Luxemburg as petrol retail chain.
 Castrol
“Castrol” is the brand that BP uses to promote industrial and automotive lubricants across the globe.
 Ampm
This is a convenient store chain attached to “ARCO” gas stations situated in US west coast and in
several countries such as Japan. This provides customers with beverages, readymade sandwiches
and other fast foods.
With series of mergers and acquisitions BP is now operating all around the world employing around
79,700 employees.
Amid the recent deepwater horizon oil spill in gulf of Mexico, BP still remains as one of the biggest oil and
petroleum company due to the strengths it has such as wide spread of its operation across the globe.
However BP had to face criticisms from around the world and US governments named BP as the
responsible party. Subsequently BP compelled to establish a $ 20 Billion fund in this regard and such will
not be capped or floored on BP liabilities.
In addition to its oil and gas operations BP operates solar power company called “BP solar” which
encourages renewable energy consumption. It had 20% market share in “photovoltaic” panels.
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10. References
 International Finance Corporation 2011, International Finance Corporation, Washington, viewed
in 09 December 2011,< www.ifc.org>
 Multilateral Investment Guarantee Agency 2011, Multilateral Investment Guarantee Agency,
Washington, viewed on 09 December 2011 < www.miga.org>
 World bank 2011, World Bank, Washington, viewed in 08 December 2011,
<www.worldbank.org>
 British petroleum PLC 2011, British petroleum PLC, London viewed in 09 December 2011,
<www.bp.com>
 The Coca-cola Company 2011, The Coca-cola Company, Atlanta ,viewed in 09 December 2011,
<www.coca-cola.com>
 The Coca-cola Company 2011, The Coca-cola Company, Atlanta ,viewed in 09 December
2011,<http://www.thecoca-colacompany.com>
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