Kanzen Berhad

5 Pages 1234 Words

Introduction and Issues: The author of our text (Ball, et al, International Business, 111) explains, “The simple concept of comparative advantage is the basis for international trade.” Although this simple concept can be shown mathematically to be the most efficient action for sovereign countries to achieve the best quantitative measure of resources, other forces that are interjected that complicate the entire trade process between countries.
Our global open market world initiative must contend with competitive sovereign governments that have an obligation to protect its citizens even economically and create a balance between protectionism and global growth. Governments have weaved a complicated web of regulatory controls including monetary penalties on foreign businesses that encroach upon their own countries ability to remain economically viable. Other laws have been passed to allow special interest groups that represent industries to petition the legal system for justice according to their eyes, in the global arena. As exhibit 14 shows, penalties include antidumping duties or AD’s, on a specific industries product if it can be proven that the product is being sold on the U.S. market at less than what it cost the foreign firm to manufacture it, (less than fair value) and is causing or threatens to cause material injury to a U.S. industry.
Synopsis: Kanzen Berhad, known as KB, company in Malaysia and a subsidiary of Kanzen Tetsu Sdn. Bhd., (KTSB), was in fact facing this very dilemma of having AD duties imposed against heir stainless steel products that they manufacture and ship mainly (80%) to the United States. A U.S. lobby group for the steel industry, Specialty Tubing Group, STG, had petitioned the Bush Administration to impose Antidumping duties on Malaysia and Thailand claiming the U.S. steel pipe industry is in jeopardy from imports selling at “below cost”.
Issues Defined: Mr. EuHong Chew, Sr. Manager and Dir...