A. Read the texts below.

A

Viewed as an employer and wealth creator, Britain’s financial system is the biggest part of the British economy. Incredibly, it has overtaken industry as the country’s leading exporter (or earner of foreign currency). And the City has become so big that it dominates the economy of southern England: property prices, services ranging from restaurants to car dealers, and even education depend on the City’s fortunes. More international telephone calls are made to and from London than any other city in the world. More airline passengers pass through London than any other place. Helped by increasing popularity of English as an international language (English is the most widely learnt second language) and London’s position mid-way between the Asian and American time zones, the British financial institutions seem more dynamic than ever.

But some big clouds loom on the horizon. One is technology. Electronic communications can cut out many of the stages through which business used to pass.

The other big cloud is Economic and Monetary Union, the European Union’s single currency. The point of EMU is to make business between the EU members easier and to weld the still disparate EU members into the world’s biggest single economy, overtaking the United States. The assumption is that a single currency will intensify competition between financial institutions in different countries and that the consumer will benefit. British financial institutions ought to flourish under EMU, backed as they are by the City and Europe’s most sophisticated financial system.

But it is uncertain whether or when Britain will join EMU. Some experts fear that staying outside the single currency will cut the country off from its European neighbours. European exchanges are banding together to take advantage of EMU and to compete with London. The City’s international status could suffer, and the ability of the country’s financial institutions to meet the needs of ordinary British people might also deteriorate. Other experts believe that Britain’s financial institutions can survive and even prosper outside EMU.

B

With its open economy, the Netherlands was among the original founders of the European Union. Ever since, it has advocated further integration, although in recent years since Euro-scepticism has set in just like elsewhere, but that seems to be related to the functioning of the EU rather than to the idea as such. People from other countries cannot fail to notice this international attitude.

Think globally, act locally. Even smaller Dutch firms are quite aware of the necessity of adapting their products, their advertising and the business behaviour of their representatives in order to meet the standards and the requirements of local markets. In response to these needs, governmental and business organisations in the Netherlands provide valuable export advice; culture and language training institutes cater to the business world; and literature and statistics abound on even the remotest countries.

The Dutch government is keen to play a global role, supporting international collaboration not only in the European Union, but also in NATO and various UN peace missions. At the same time, we shouldn’t overlook the fact that this country is also the world’s largest arms exporter and one of the world’s largest importers of tropical hardwoods (which, being water-resistant, is used both in the construction of housing, boats and port equipment).

In the rapidly expanding EU, the Netherlands is now merely one of many small nations (albeit* one with large economy that has always been a loyal net-contributor[1]). In broad outline, this country remains firmly rooted in the European Union and the world community, with an open eye to all sides, balancing the commercial interests of the economy with the human ideas of peace, development and equal opportunities for people everywhere.

Yet, at the same time, the policy for admitting asylum-seekers has hardened in recent years. And with the enlargement of the EU toward Central Europe in 2004, the Netherlands was one of the countries trying to protect its labour market by keeping out workers from the new member states for the first two years. Further, European elections result in low participation. Instead of enthusiasm about a new start for this old continent, there are concerns about finance, employment and safety close to home.

b. Draw a parallel between the United Kingdom, the Netherlands and the Russian Federation to cover the points in the following chart. Surf the Internet for keywordsEU, EMU, European exchanges, the City, Eurozone, Maastricht Treaty.

1.7 CASE STUDY & ROLE PLAY

Case 1

“Coburn Tool Corporation, an American manufacturer of large and small machine tools and parts, gears, valves, and bearings, was a major supplier to industries and companies world-wide. Because of the rise of the U.S. dollar on exchange markets and serious financial crises in many of the countries in which Coburn did business, sales, particularly to Latin America, began to decline.

A major market for Coburn’s products had until recently been Brazil. For instance, in 1980 sales to that country’s industries were $640,000; but by 1983 sales had declined to just $183,000.

This serious problem seemed to have little solution because of Brazil’s chronic credit problems and lack of foreign exchange.

In the fall of 1984, however, a unique proposition was received at Coburn’s head office near Cleveland, Ohio, from a Brazilian commodities broker, Companhia Internacional de Comercio, S.A. (CIC). CIC’s offer was essentially this: in exchange for US $ 400,000 in assorted gears, Coburn would receive the equivalent in Brazilian shoes, which it could sell in the American market.”