IN THE NAME OF ALLAH THE MOST BENEFICENT AND THE MOST MERIFUL

Presenter

Arslan Ahmed

EXPANSION OF BUSINESSProject of International Business & WTO

Content Layout

Selected Country Country advantages Our Company Destination Country (Nepal) Why Nepal Mode of Expansion Theory of FDI Q&A Session

Selected Country

Switzerland

About Switzerland

Capital:   Bern Cantons: 23 Area-Total: 41,285 km2 (133rd) Water (%): 4.2 Population: 8,014,000 GDP: 632.2 billion USD Largest City: Zurich Dialing code:  41 Currency:  Swiss franc Official languages: German, French , Romansh , Italian Government: Federal republic, Directorial system Neighbors Austria, Liechtenstein, France, Italy, & Germany

Country Advantages

Top pharmaceutical companies(Medicament)

Swiss Watches Swiss chocolate Swiss is also popular for

its Secretive banking Sector

It’s also popular for Hospitality Sector

Tourism industry Direct Democracy Location (land

locked) Hydropower Agriculture

Products

Comparative Advantage Absolute Advantage

Selected Comparative & Absolute Advantage

Pharmaceutical:  It contributes to 5.7% of the GDP Contributes to 30% of the

exportations Employs about 135'000 people Some popular pharmaceutical

companies are:  Novartis (Sandoz), Hoffmann-La

Roche, Basilea Pharmaceutica, Actelion andStraumann, Merck Serono (Serono), Ferring Pharmaceuticals, Debiopharm, Nycomed, Janssen-Cilag, Galderma,Mondobiotech, Naari, Weleda, Octapharma  and Frewitt.

Agricultural Products: Produces about 60% of the food

consumed Switzerland is subsidizing more

than 70% of its agriculture compared to 35% in the EU.

90 to 100% of potatoes, pork, veal, cattle and most milkproducts, are produced in the country

8.1 % of the total Swiss workforce was employed in the sector

Number of organic farms increased by 3.3 percent between 2009 and 2011.

Selected Comparative advantage

Selected Absolute Advantage

Our Company

Hoffman La-Roche: Founded in 1896, headquartered in Basel,

Switzerland Roche is the world’s largest biotech company Represented in over 150 countries Number of employees 82,089 Employee growth +2% Sales rise 4% to 45.5 billion Swiss francs due

to oncology sales, clinical laboratories business Core EPS 10% higher at 13.62 Swiss francs

Contd’

Board proposes dividend increase of 8% to 7.35 Swiss francs, the 26th consecutive year of growth

Outlook for 2013 sales to grow in line with previous year, core earnings per share targeted to grow ahead of sales. Roche expects to further increase dividend.

Operating free cash flow rises 10% to 15.4 billion Swiss francs

Destination Country

Nepal

Nepal

Officially the ”Federal Democratic Republic of Nepal” with capital Kathmandu

landlocked sovereign state located in South Asia With an area of 147,181 square kilometers

(56,827 sq mi) Population of approximately 30 million 41st most populous country Religion:

Hindu 80.6% Buddhist 10.7%, Muslim 4.2%, Kirant 3.6%, other 0.9%

Why Nepal?

2,335 foreign investment projects with a total investment of approximately $2.76 billion.

Available labor force 18 million in 2012 A decade long  Nepalese Civil War has come

to an end Government brought constitutionals reforms

to attract the FDI Population is growing fast Disease prevalence is higher in Nepal than it

is in other South Asian countries

Contd’

Our company has presence in its neighboring countries Such As China & India

Nepal is in the list of countries with least medical facilities

Risk of major Infectious diseases is very high. Disease prevalence is higher in Nepal than it is in other South Asian countries

Already have an experience and knowledge of South Asian Region

Government decided to spent 7% of GDP on health instead of 5% previously

Less competition

Mode of Expansion

Direct Export: Reasons:

Manufacturing facility in India and China Better understanding of Region Customer satisfaction Greater protection of patents and copyrights It suits us as the volume of our product is small To avoid intermediaries To get benefits from government policies To minimize the cost of product

Theory Of FDI

Seekers of Advantage: Markets

Bigger market with population of 30 million Easy to approach Potential market as Disease prevalence is higher

than any other South Asian country Tax exemptions:

Income tax is exempt for a period of 7 years in the case of national priority industries.

Industries which provide direct employment to 1000 persons or more shall be entitled to an additional 2 year exemption from income tax.

Question & Answer Session