Businesses do not exist in a vacuum. Outside factors affect them, and often those factors extend beyond national borders. Global forces affect competition, available resources and even how businesses interact with their customers. To pursue growth, businesses have to adapt to ever-changing markets.
As the world becomes increasingly interconnected, more and more businesses are venturing into international investments and operations. For these businesses, special strategies are necessary to keep up with the demands of the global economy. Students in a Master of Business Administration with a Concentration in Finance program learn to tackle the unique challenges posed by global finance.
The Global Economy Is Interconnected
Financial situations in countries all over the world affect the global economy. New advancements in technology promote globalization, further connecting the world’s financial markets. Government policies in countries across the globe have been instrumental in opening foreign markets for international trading. As globalization continues, businesses find it easier to grow beyond their own countries’ borders and participate in global markets.
International business opportunities have become a major part of the current global economy. Many governments encourage international commerce, resulting in fewer barriers to importing and exporting. This means that even individual citizens can take advantage of foreign markets through personal investments.
Globalization means an individual nation’s economy can positively influence others, but negative effects are also a risk. Internal financial disasters can now more easily affect outside countries. A potential debt crisis in one nation could result in decreased confidence in investing and an instability in financial markets across the world. The global economic situation can affect banks’ willingness to lend capital, which may harm businesses in the startup phase. Increased competition is a side effect of the increased market potential offered by globalization, and it can have a major impact on how businesses interact with each other and their customers.
The Benefits of Studying Global Finance in an Online MBA Program
Studying global finance allows MBA students in finance to claim the biggest benefits from the global economy. Special considerations are necessary when companies get involved with international markets; studying these markets will position MBA students as competitive job candidates.
The online MBA program at Texas A&M University-Corpus Christi, for example, offers finance concentration courses that include international finance. Students can expect to learn about the following:
- Financial planning and decision-making for corporations in multinational environments.
- Measuring and managing risks associated with currency exchange rates.
- Financing international trade.
- Foreign investment.
- Analyzing risks on a per-country basis.
- The role of financial institutions in the global economy.
- Financial regulation.
- The global impact of central banking monetary policy.
Participating in international financial transactions gives organizations additional opportunities for growth, but it also carries additional risks. For example, currency exchange rates are constantly changing. This means that investments in foreign markets can change in value simply because of exchange rate fluctuations. Organizations have to weigh the pros and cons of engaging in foreign business activity and decide on a case-by-case basis whether the risks are worth the potential reward. Finance professionals are often responsible for accessing these factors and finding ways to mitigate some of the risks. This requires a solid foundation in financial skills as well as as working knowledge of multinational finance.
The global economy affects businesses worldwide, especially those involved in international markets. Businesses can enter foreign markets in a variety of ways, and it is the responsibility of a company’s financial professionals to analyze the benefits and risks involved. Students pursuing an MBA in finance learn the global finance skills they need in today’s complex marketplaces. With these skills, they are better prepared to guide a company through the international financial landscape.
Learn more about the TAMUCC online MBA in Finance program.