Higher Nationals - Summative Assignment Feedback Form

Student Name/ID Nguyen Van Hung/GBH211231

Unit Title Unit 25: Global Business Environment (5076)

Assignment Number Assignment 1 Assessor Diem Thi Thanh Hai

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I. Introduction.
1.1. Introduction to the report.
My choice of Chemical Plastics comes from my deep interest in science and the application of materials
in everyday life as well as in industry. The Chemical Plastics industry has a wide range of applications, it
provides important products and materials for many different industries such as manufacturing,
healthcare, automobiles, electronics, and many other fields. In this industry, there will always be a
contribution to the environment by recycling environmentally friendly materials. There will be career
opportunities and growth followed by creativity and innovation. What is important is Calculations and
Science because this Industry requires a deep understanding of chemistry, materials and manufacturing
processes, and requires high computational skills. This report includes three main parts. The first part is
the main drivers of globalization, followed by the main global strategic complexities, then the
recommendations for globalization in a digital world.

1.2. Overview of Globalization.

The purpose of this report is that it is an overview of globalization put into a concise definition. The word
"globalization" refers to the process of trade and technological advancement that has increased
connectivity and interdependence around the world. The breadth of globalization also includes subsequent
economic and social transformations (National Geographic Society, 2023).
Aspects of Globalization include: economics, culture, politics and society. Economically, Globalization
opens markets for businesses, facilitates competition and enhances performance. We have an example of
the economics of the Chemical Plastics Industry: "International supply chain", the Chemical Plastics
Industry uses raw materials and sales markets globally, for example, importing raw materials from a
country and export products to other markets (Jones, 2006 ).
Regarding culture, Globalization brings contact between cultures, creating diversity in work and
communication in the Chemical Plastics industry on an international scale.
For example, consumer trends for environmentally friendly products can influence demand in this
industry around the world so are called (Karliner, 1997).

Political globalization refers to the process of internationalizing political aspects. It is a phenomena that
is marked by dynamic interactions and multifaceted reactions among the many parts that make up the
global political system. It not only occurs constantly and nonlinearly, but it also makes the degree of
dependency between these components more complex and high. Global political processes take place
within the framework of global political trends, resulting in the creation of new political players and a
structural modification of the international relations system worldwide. This forms a global political
system and structure and fosters a climate of greater political interdependence and interconnectedness
(Leonova, 2022).
The plastic chemicals industry is a global industry that has been affected by political globalization. An
example of this is the Single-Use Plastics Directive adopted by the European Union, which aims to
reduce the amount of plastic waste generated. The chemical industry is starting to organize activities
related to this issue in response to public outcry about global plastic pollution. The industry is moving
beyond the use-once-and-throw-away approach and is accepting an expanded definition of product
responsibility to include the disposal of plastic waste. This is not only a societal requirement, but could
also represent an important and profitable new business opportunity. The plastic industry is found all over
the world, even in the most developing countries like Congo and Burundi. However, the amount of plastic
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waste generated is increasingly becoming a serious environmental problem. If plastic demand continues
on current trends, the global volume of plastic waste will increase from 260 million tons per year in 2016
to 460 million tons per year in 2030. Recycling and reusing plastic can generated profit growth of up to
$60 billion for the petrochemical and plastics industry, representing nearly two-thirds of its possible profit
growth over that period (Hundertmark, Mayer, McNally, Simons and Witte, 2018).

The globalization of society is a complex and multidimensional process that involves the sharing of
ideas, information, and cultural values across national boundaries. In today's environment, the Internet
and social networking platforms play an important role in creating a global community where users can
interact and share quickly. Cultural products such as international films, books, and television shows are
prime examples of social globalization (tutor2u, 2020).
Example:
Diverse works of art such as the Harry Potter and Twilight film series, among other cultural creations,
have transcended national borders to become global realities. The characters and stories in these works
have gained popularity and recognition worldwide, forging a global cultural connection. However, it's
essential to acknowledge that this cultural flow may tend to originate from the center, where developed
countries like the United States and Europe influence less developed cultural landscapes. Furthermore,
social globalization extends beyond the realm of cultural entertainment to open forums and opportunities
for sharing knowledge, experiences, and perspectives within the international community. Online
discussions, international conferences, and community projects can create a space where individuals
worldwide can contribute ideas and learn from one another (tutor2u, 2020).

II. Key driving factors of globalization.

2.1. Key drivers affecting plastic and chemical industry.
The Plastics and Chemicals industry is experiencing globalization due to many key drivers. According to
Johansson and Yip the Yip model (1994), the driving force for consumer decisions is the high demand for
safe and environmentally friendly
products followed by increased demand for recycled and reused products. At the same time, challenges
from the Supplier side, such as diversity in energy supply and stability of raw materials, always pose
new requirements for the industry.
Businesses will always compete to innovate and improve. However, the safety of chemicals and
especially environmental protection is always prioritized and guaranteed by the law. The development of
technology also plays an important role in promoting faster production processes and recycling of
products. All of these dynamics are shaping the picture of globalization for the Chemical Plastics
Industry, requiring adaptation to each era and innovation to meet new challenges and opportunities.

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Cost Drivers

Scale Economics:

In the dynamic landscape of the chemical plastics industry, the principle of scale economics stands out
prominently. The sheer magnitude of production volumes in this sector allows companies to leverage economies
of scale to their advantage. This is particularly evident in the manufacturing processes of staple plastic materials
like polyethylene and polypropylene. By engaging in mass production, these companies can efficiently distribute
fixed costs across a larger number of units, resulting in a noticeable reduction in the average cost per unit. To
illustrate, major players in the chemical plastics industry often pursue strategies that involve consolidating their
operations to achieve higher production volumes. This might manifest in the centralization of production
facilities or the strategic expansion of existing capacities. The overarching goal is to harness the benefits of
economies of scale, not only to optimize costs but also to enhance overall competitiveness. The cost advantages
derived from these scale-driven strategies may further catalyze mergers and acquisitions within the industry,
fostering a landscape where larger entities can attain greater operational efficiency and market dominance
(Moritsch, 2020)
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Country-Specific Differences:

Differences in cost structures across various nations play a pivotal role in shaping the dynamics of the chemical
plastics industry. The industry experiences a spectrum of factors that contribute to country-specific differences,
including varying labor costs, raw material expenses, and regulatory landscapes. Some countries may boast lower
production costs, driven by factors such as inexpensive labor or abundant access to crucial raw materials. Others
may distinguish themselves through skilled labor forces and a propensity for innovation, influencing the
industry's overall cost paradigm. In response to these disparities, companies operating in the chemical plastics
sector strategically position their operations in countries with favorable factor costs. This strategic decision-
making might involve outsourcing certain processes to regions with lower production costs or establishing
manufacturing plants in areas rich in skilled labor. However, in navigating country-specific differences, managers
must exercise foresight and adaptability, acknowledging the potential risks associated with shifts in regulations or
unforeseen economic developments. Flexibility becomes a cornerstone for sustained cost efficiency in this ever-
evolving global industry (MARY, 2020).

Favorable Logistics:

Logistics emerge as a linchpin in the intricate web of the chemical plastics industry, exerting a profound
influence on overall costs. The efficient transportation of raw materials and finished products is paramount, and
companies strategically position themselves to capitalize on favorable logistics. Proximity to key suppliers,
distribution centers, and end markets becomes a strategic advantage, yielding a reduction in transportation costs.
Moreover, a well-designed supply chain strategy that minimizes lead times and transportation distances adds an
additional layer of efficiency to the overall logistics framework. Companies operating in the chemical plastics
sector embark on a journey of optimizing their supply chain and distribution networks. This optimization often
involves strategically locating production facilities near raw material sources or key markets, thereby mitigating
transportation costs. The non-perishable nature of many plastic products affords companies flexibility in
transportation methods, allowing them to choose cost-effective shipping strategies. As such, the consideration of
logistical factors becomes pivotal when determining the cost structure and competitiveness of chemical plastics
products in the global market (Satefano, 2020).
Example:
Binh Son Refining and Petrochemical Company Limited (BSR), an enterprise operating in the oil and
chemical sector in Vietnam, has implemented renewable energy projects such as installing solar power
systems and improving efficiency energy during production. This helps reduce energy costs and at the same
time increase the sustainability of chemical production. Raw materials of Binh Minh Plastic Company
(BMP) in Vietnam have built partnerships with raw material suppliers to ensure stable supply. They can
negotiate raw material purchasing conditions, minimize the impact of raw material price fluctuations and
ensure stable production costs (Vietnam Online, 2022).

Market drivers

Similar Customer Needs:

In the Chemical Plastics industry, the identification and understanding of similar customer needs emerge as
a crucial market driver. The demand for plastic products spans across diverse sectors, including packaging,
automotive, construction, and consumer goods. The industry's ability to recognize and cater to these shared
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needs allows companies to streamline their product offerings, optimize production processes, and achieve
economies of scale. (MICHAEL, 2022)

Evidence from the industry indicates that customer needs for versatile, cost-effective, and sustainable plastic
solutions are universal. For instance, the demand for eco-friendly packaging materials has become a shared
priority among consumers globally. Companies responding to this market driver invest in research and
development to create innovative, environmentally friendly plastics. The alignment of product development
with universally shared customer needs positions these companies as market leaders, fostering customer
loyalty and market growth (Kun, 2024).

Global Customers:

The Chemical Plastics industry is increasingly characterized by the presence of global customers, signaling
a shift towards a more interconnected and interdependent market. Multinational corporations, operating on a
global scale, seek standardized plastic solutions for their diverse operations. This trend acts as a market
driver by compelling chemical plastics companies to develop products and services that meet the stringent
and standardized requirements of these global customers. Evidence supporting this market driver is found in
the industry's strategic alliances and collaborations. Major players in the Chemical Plastics sector often
engage in partnerships to create standardized products suitable for global customers. These collaborations
not only facilitate knowledge exchange but also enable companies to streamline production processes,
reduce costs, and ensure consistent product quality across different regions. Responding effectively to the
needs of global customers becomes a key determinant of success in this competitive landscape (Kun, 2024).

Transferable Marketing:

Transferable marketing strategies play a pivotal role as a market driver in the Chemical Plastics industry.
The ability to adapt marketing efforts across diverse regions and cultures allows companies to effectively
penetrate new markets and capitalize on emerging opportunities. Evidence from successful marketing
campaigns in the industry demonstrates the importance of tailoring messages to resonate with the unique
needs and cultural nuances of different customer bases.
For example, companies in the Chemical Plastics sector employ transferable marketing by emphasizing
sustainability and recyclability in regions where environmental consciousness is high, while focusing on
durability and performance in sectors where these attributes hold greater significance. This adaptability
ensures that marketing efforts resonate with local customer preferences, enabling companies to build brand
loyalty and gain a competitive edge. In essence, the Chemical Plastics industry's ability to identify and
respond to similar customer needs, cater to global customers, and deploy transferable marketing strategies
collectively acts as a driving force, influencing market dynamics and shaping the success of companies
within this dynamic sector (Marco, 2020).

Example
Increasing demand for sustainable products: Tan Tao Plastic (TTP) in Vietnam has adapted to market trends
by converting some plastic products to recyclable and environmentally friendly forms. This not only meets
the growing demand for sustainability from customers but also enhances the company's image and reputation.
The globalization of Long Son Petrochemicals, a chemical enterprise in Vietnam, has sought opportunities to
export products to international markets.
They want to scale their business and take advantage of opportunities in new regions to ensure stability and
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growth (Viet Nam News. 2023).

Government drivers

Trade Policies:

Trade policies significantly influence the operations and dynamics of the Chemical Plastics industry, acting
as a key government driver. Governments play a pivotal role in shaping international trade relationships
through regulations, tariffs, and trade agreements. In the Chemical Plastics sector, evidence suggests that
changes in trade policies can have a profound impact on market dynamics. For example, the imposition of
tariffs on specific plastic products or raw materials can disrupt established supply chains and alter cost
structures. Conversely, the reduction or elimination of trade barriers through free trade agreements can
create opportunities for companies to access new markets and sources of raw materials more efficiently.
Moreover, governments often use trade policies to address environmental concerns. Regulations restricting
the import or production of certain types of plastics to curb pollution are prevalent. Companies operating in
the Chemical Plastics industry must stay abreast of these trade policies and adapt their strategies to navigate
changing trade dynamics (OECD, no date).

Technical Standards:

Government-driven technical standards are a crucial factor shaping the Chemical Plastics industry. Evidence
indicates that regulatory bodies establish and enforce technical standards to ensure product safety,
environmental sustainability, and compatibility with existing infrastructure. Compliance with these
standards is not only a legal requirement but also a market driver that influences consumer trust and industry
competitiveness. In the Chemical Plastics sector, adherence to technical standards is evident in the
development and production of plastic materials for various applications, such as packaging, automotive
components, and construction materials. Regulatory bodies set specifications regarding material
composition, durability, and recyclability, among other factors. Companies that proactively invest in
research and development to meet or exceed these technical standards position themselves as industry
leaders. Moreover, standardization facilitates international trade by ensuring that products meet the
requirements of diverse markets, contributing to the globalization of the Chemical Plastics industry
(Sgobaba, 2022).

Host Government Policies:

Government policies implemented by the host countries where chemical plastics companies operate have a
profound impact on industry dynamics. Evidence from the Chemical Plastics industry suggests that host
government policies encompass a wide range of areas, including environmental regulations, incentives for
innovation, and support for sustainable practices. For instance, environmental policies may dictate
restrictions on the use of certain plastic materials or mandate recycling initiatives. Companies aligning their
operations with host government environmental goals can enhance their reputation and comply with
evolving regulations. Furthermore, incentives for research and development or tax breaks for sustainable
practices can drive innovation within the industry. Host governments may encourage companies to adopt
eco-friendly technologies and practices through supportive policies, influencing the overall trajectory of the
Chemical Plastics sector towards sustainability. In summary, trade policies, technical standards, and host

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government policies collectively act as government drivers in the Chemical Plastics industry, shaping
market dynamics, influencing strategic decisions, and fostering sustainability within the sector. Companies
navigating this landscape effectively must stay informed about and adapt to the evolving regulatory
environment (PRI, n.d).

Example:

The Vietnamese government has implemented strict environmental management measures, setting
regulations on waste management and chemical safety. This forces businesses to comply and invest in
environmental treatment measures. The government has introduced policies to encourage the use of recycled
materials and support businesses in implementing recycling projects. This promotes the transformation of
the chemical plastics industry towards a cleaner and sustainable production model (International Trade
Administration, 2021).

Competition drivers:

Interdependence between Countries:

In the Chemical Plastics industry, the interdependence between countries emerges as a significant
competition driver. Evidence suggests that the global nature of the industry fosters intricate relationships and
dependencies between countries. This interdependence is evident in the supply chain dynamics, where raw
materials, production processes, and markets are often distributed across multiple nations. For example, a
country may specialize in the production of specific raw materials crucial for plastic manufacturing, while
another excels in advanced production processes. This interconnectivity creates a competitive environment
where countries rely on each other's strengths and capabilities to enhance overall industry competitiveness.
The intricate web of interdependence also means that disruptions in one part of the world can have ripple
effects on the entire industry. Natural disasters, geopolitical events, or economic downturns in one country
can impact the entire supply chain. As a result, companies operating in the Chemical Plastics industry must
navigate this interdependence by building resilient supply chains, forming strategic alliances, and staying
attuned to global economic trends (Moristich, 2022).

Competitor's Global Strategies:

The global strategies adopted by competitors play a pivotal role in shaping competition dynamics within the
Chemical Plastics industry. Evidence indicates that major players in the industry often pursue
comprehensive global strategies to gain a competitive edge. These strategies encompass a range of
initiatives, including international mergers and acquisitions, strategic partnerships, and the establishment of
a global presence. For instance, a competitor may expand its operations globally to tap into emerging
markets with increasing demand for plastic products. Strategic alliances and joint ventures with local
companies can facilitate market entry and provide access to regional expertise. Additionally, mergers and
acquisitions enable companies to consolidate their positions, achieve economies of scale, and broaden their
product portfolios. Companies in the Chemical Plastics industry also strategically invest in research and
development on a global scale to stay ahead of technological advancements. This allows them to introduce
innovative products, meet evolving customer demands, and outpace competitors in terms of product quality
and performance (Olga, 2022).

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Technology and Innovation:

Technology and innovation serve as key drivers of competition within the Chemical Plastics industry.
Evidence highlights the industry's constant pursuit of technological advancements and innovative solutions
to stay competitive. This is particularly evident in the development of new materials, manufacturing
processes, and sustainable practices. For example, companies invest heavily in research and development to
discover alternative raw materials, improve production efficiency, and enhance the recyclability of plastic
products. Technological innovations also play a crucial role in meeting regulatory requirements, such as
developing eco-friendly materials or reducing the environmental impact of production processes. Innovation
extends beyond product development to include advancements in automation, data analytics, and artificial
intelligence. Companies leveraging these technologies gain a competitive advantage by optimizing
operations, reducing costs, and responding more effectively to market trends (Thomas, 2018).

Example:
Binh Minh Plastics (BMP) and PetroVietnam are both competing by continuously improving product quality
and investing in research and innovation. This helps them maintain and expand their market by responding
quickly to changing customer needs. Vinachem and Petrolimex Petrochemical are two businesses in Vietnam
participating in the race to reduce prices to maintain and expand the market. Strong competition requires
them to be flexible in their pricing strategies to attract and retain customers in the industry (Nguyen, 2023).

2.2. Key digital technologies and innovation.

Digital technologies
The Plastics and Chemicals industry in Vietnam is undergoing a significant transformation, in sync with the
explosion of digital technologies and innovation. In this context, advanced technologies such as Internet of
Things (IoT), virtual reality (VR), augmented reality (AR), artificial intelligence (AI), and Blockchain are
playing a big role in forming a new face of this industry and having a significant impact on the globalization
process (Nancy, 2023)
One of the most notable trends is the integration of IoT into supply chain management. Businesses in the
Chemical Plastics industry in Vietnam are using sensors and monitoring systems to monitor every step in the
supply chain, from
raw material management to transportation and production processes. This brings accuracy and efficiency,
minimizes losses and enhances competitiveness in the international market (Oracle, 2020)
VR and AR have opened up a new frontier in training and simulation. Using this technology helps create a
simulation environment for production and personnel training, reducing training time and improving
employee skills. This not only helps businesses save training costs but also enhances labor safety and the
ability to transfer technology between production units globally (Nayak, 2023)
AI and data analysis capabilities are increasingly integrated in the Chemical Plastics industry. AI not only
helps forecast market demand and optimize production processes but also helps businesses quickly adapt to
global market fluctuations. Along with that, Blockchain is applied to manage data about the origin, quality,
and safety of products. This enhances data transparency and security, meeting the requirements of
environmental protection and chemical safety principles in the international market (Postindustria, 2023).

The innovation of Virtual Reality (VR), Augmented Reality (AR), and Artificial Intelligence (AI)
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technologies has a significant impact on the Chemical Plastics industry. AR and VR technologies can be
used to augment training in the chemical sector, enabling training scenarios specific to the business. AI tools
like ChatGPT and AR/VR can be incorporated into chemical manufacturers’ workflows to complete logical
processes for chemical producers and equipment manufacturers. These technologies can help create a 3D
environment that replicates the real world, and the data used can be harnessed for analysis, running
simulations, and interacting with data more efficiently. The use of these technologies can lead to increased
productivity and efficiency metrics, as well as reduced time and effort involved in sharing detailed
engineering data. The chemical industry is a global industry, with many companies operating across
borders. The use of these technologies can help promote global trade by enabling companies to innovate and
meet the needs of rapidly changing global communities. In addition, digital platforms are becoming
increasingly important in the chemicals industry, with B2B buyers being open to making purchases via
digital platforms. The AR and VR market is projected to generate revenue of US$38.6bn in 2024, with an
expected annual growth rate of 10.77% (CAGR 2024-2028). The use of these technologies can help the
Chemical Plastics industry stay competitive and meet the needs of customers worldwide (Statista, 2023).

3. Key global strategic complexities.

3.1. The complexity of strategic challenges.
3.1.1. Some of the most influential international trade laws and their impacts on MNCs.
The chemical plastics industry is subject to a number of international trade laws that have a significant
impact on multinational corporations (MNCs). One such law is the Basel Convention, which regulates the
transboundary movement of hazardous waste, including plastic waste, between countries. The convention
has been ratified by 188 countries and has led to a significant reduction in the amount of plastic waste being
exported from developed countries to developing countries. Another important law is the Stockholm
Convention, which aims to reduce or eliminate the production and use of persistent organic pollutants
(POPs), including certain chemicals used in the production of plastics. The convention has been ratified by
152 countries and has led to the phase-out of several POPs, including polychlorinated biphenyls (PCBs) and
dichlorodiphenyltrichloroethane (DDT). The World Trade Organization (WTO) also plays a significant role
in regulating international trade in plastics. The WTO’s Agreement on Technical Barriers to Trade (TBT)
and Agreement on Sanitary and Phytosanitary Measures (SPS) set standards for the production and trade of
goods, including plastics, to ensure that they are safe for human health and the environment. These
agreements can have a significant impact on MNCs, as they may be required to comply with different
standards in different countries. Finally, the United Nations Framework Convention on Climate Change
(UNFCCC) and the Paris Agreement have also had an impact on the chemical plastics industry. These
agreements aim to reduce greenhouse gas emissions and limit global warming, which has led to increased
interest in the development of biodegradable plastics and other sustainable alternatives. Overall, these
international trade laws have had a significant impact on the chemical plastics industry and MNCs, as they
have led to increased regulation and the development of new technologies and materials (UN environment
programme, n.d).

3.1.2. How the global economics may impose more risks to MNCs and how MNCs may respond to this
challenge with their diversification strategies.
The global economy poses a significant risk to multinational corporations (MNCs) operating in the chemical
plastics industry. The KPMG Global Economic Outlook for Chemicals report states that the outlook for the
industry is tightening due to inflation, which is putting pressure on households’ finances and businesses’
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margins, and causing central banks to tighten monetary policy aggressively. As a result, a recession is again
on the horizon in many economies. This could lead to lower consumption, supply chain constraints, and
input costs, which could slow future investment and impact long-term industry plans around sustainability
and decarbonization. To respond to this challenge, MNCs can adopt diversification strategies. One such
strategy is to diversify their product portfolio by investing in the development of new materials and
technologies that are more sustainable and environmentally friendly. Another strategy is to diversify their
geographic footprint by expanding into new markets, such as emerging economies, where demand for
chemical plastics is growing. MNCs can also consider diversifying their supply chain by sourcing raw
materials from multiple suppliers and reducing their dependence on a single supplier or region. By adopting
these diversification strategies, MNCs can mitigate the risks posed by the global economy and ensure their
long-term sustainability and growth (Ryan, 2022).

3.1.3. Explain some issues of the environmental impacts in associated with such risk and diversification
strategies.

The chemical plastics industry is facing a number of environmental impact issues associated with the global
economy and the risks posed by it. The OECD Global Plastics Outlook report highlights the negative
environmental impacts of plastics production and waste generation, which continue to increase despite
international, national, and local policy responses, as well as industry commitments. The report identifies
four key levers for bending the plastics curve: stronger support for recycled (secondary) plastics markets;
policies to boost technological innovation in plastics; more ambitious domestic policy measures; and greater
international co-operation. The transfer of products, processes, and business models from developed to
emerging or developing economies often gives rise to exacerbated negative externalities because of
institutional voids in environmental protection. To mitigate these risks, multinational corporations (MNCs)
can adopt diversification strategies. One such strategy is to diversify their product portfolio by investing in
the development of new materials and technologies that are more sustainable and environmentally friendly.
Another strategy is to diversify their geographic footprint by expanding into new markets, such as emerging
economies, where demand for chemical plastics is growing. MNCs can also consider diversifying their
supply chain by sourcing raw materials from multiple suppliers and reducing their dependence on a single
supplier or region. By adopting these diversification strategies, MNCs can mitigate the risks posed by the
global economy and ensure their long-term sustainability and growth (Ellen, 2020).

3.1.4. Examine the difficulties for MNCs when participate in international supply chains management (such
as global sourcing, production and distribution).
Multinational corporations (MNCs) face several difficulties when participating in the international supply
chain management of the chemical plastics industry. One of the most significant challenges is supply chain
disruption. The Harvard Business Review reports that disruptions of the raw materials for many common
kinds of plastics are now occurring, leading to factory shutdowns, sharp price increases, and production
delays across a range of industries. These disruptions have been caused by a variety of factors, including the
pandemic, container shortages, winter weather, factory fires, and logistics woes. Another challenge is
quality assurance standards. Chemical manufacturers face challenges such as lack of visibility, planning
production, coordinating material delivery, and managing inventory for cost efficiency. MNCs must ensure
that their products meet the quality standards of different countries and regions, which can be difficult due
to differences in regulations and standards (Vakil, 2021). Additionally, logistics and transportation can be a
challenge for MNCs. The OECD Global Plastics Outlook report highlights the negative environmental
impacts of plastics production and waste generation, which continue to increase despite international,

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 national, and local policy responses, as well as industry commitments. MNCs must ensure that their
transportation and logistics processes are environmentally sustainable and comply with regulations in
different countries. To overcome these difficulties, MNCs can adopt several strategies. One such strategy is
to diversify their supply chain by sourcing raw materials from multiple suppliers and reducing their
dependence on a single supplier or region. Another strategy is to invest in technology to improve supply
chain visibility and coordination. MNCs can also consider expanding their geographic footprint by
establishing local production facilities in different countries and regions. By adopting these strategies,
MNCs can mitigate the risks associated with international supply chain management and ensure their long-
term sustainability and growth (Dorata, 2021).

3.2. Examine the main challenges and opportunities.

3.2.1. Legislation and regulatory requirements.
Operating in a global environment can be challenging for chemical plastics businesses. One of the key
challenges is complying with legal and regulatory requirements. These requirements can vary significantly
from country to country and can be difficult to navigate. For example, the European Union’s REACH
regulation requires companies to register and provide information on the properties and uses of chemicals
they produce or import. In the United States, the Toxic Substances Control Act (TSCA) requires companies
to report information on chemicals they manufacture or import. In China, the Ministry of Ecology and
Environment (MEE) has implemented a series of regulations aimed at reducing pollution and improving
environmental protection. These regulations have significant implications for chemical plastics businesses
operating in China (Bindiya, 2021).
In addition to complying with legal and regulatory requirements, chemical plastics businesses also face
opportunities in the global economy. For example, the increasing demand for sustainable and eco-friendly
products has led to the development of new biodegradable plastics. Companies that can develop and market
these products effectively can gain a competitive advantage in the global market. Another opportunity is the
increasing demand for plastics in emerging markets such as India and China. Chemical plastics businesses
that can successfully enter these markets can benefit from increased sales and revenue. Overall, chemical
plastics businesses operating in the global economy face a range of challenges and opportunities. By
complying with legal and regulatory requirements and taking advantage of emerging trends, these
businesses can position themselves for long-term success (Tommaso, 2022).

3.2.2. Operating across different time zones.

Operating in a global environment poses a multifaceted challenge for chemical plastics businesses, and one
significant hurdle they encounter is the need to coordinate operations across diverse time zones. This
intricate dynamic introduces complexities in communication and collaboration, particularly when teams are
geographically dispersed. The intricacies become apparent when, for instance, a team based in the United
States seeks to communicate with counterparts in China, necessitating the scheduling of meetings outside
conventional business hours. This not only disrupts the conventional work routine but can also give rise to
issues related to work-life balance and employee burnout, as individuals are compelled to adapt to non-
traditional working hours. However, amidst the challenges, there lie notable opportunities associated with
navigating different time zones. Companies can strategically exploit the 24-hour work cycle to their
advantage, leading to heightened productivity and reduced turnaround times. The deployment of teams
strategically positioned across various regions ensures that work progresses continuously, creating a
seamless workflow. This approach is particularly advantageous for chemical plastics businesses that operate
on a global scale, requiring the coordination of activities across diverse countries and time zones. In
essence, the intricacies of working across different time zones unveil a spectrum of challenges and
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opportunities for chemical plastics businesses engaged in the global economy. The key lies in finding
innovative ways to facilitate effective communication and collaboration across diverse regions. By doing so,
these businesses not only overcome the challenges posed by global time zone differences but position
themselves strategically for sustained long-term success in the international business landscape (Lorin,
2020).

3.2.3. Culture differences and cultural diversity.

Operating in a global environment poses challenges and opportunities for chemical plastics businesses.
Cultural differences and diversity can create communication and collaboration hurdles, especially when
teams span different regions. For example, coordinating meetings between a U.S.-based business and a
Japanese partner may require scheduling outside regular working hours, potentially impacting work-life
balance and causing employee burnout. However, global operations also offer chances for innovation. The
growing demand for sustainable products has spurred the development of bio-based plastics, providing
businesses with opportunities to gain a competitive edge globally. Additionally, emerging markets like India
and China present a rising demand for plastics, allowing chemical plastics businesses to boost sales and
revenue. Navigating these challenges while embracing opportunities, respecting cultural diversity, and
complying with legal regulations can position these businesses for sustained success (Hancock, 2020).

4. Recommendations for globalization in digitalized world.

Enterprises in the chemical plastic industry are currently facing a myriad of opportunities and challenges
amidst globalization and digitization. In the context of globalization, maintaining business stability becomes
challenging due to political instability and changes in legislation. Additionally, there is a new demand for
global risk management by companies, including the need for flexible supply chains and adaptive strategies.
Global operations in the chemical plastic sector encounter difficulties due to legal constraints and
regulations varying across regions and countries. The disparity in safety standards and environmental laws
among nations is a significant issue.

To ensure global safety and environmental protection beyond compliance with local legal requirements,
companies must establish and maintain a robust compliance management system. However, there are also
tremendous opportunities. Industrial digitization opens up new possibilities for automation and data
management, reducing costs and improving efficiency, especially in the era of Industry 4.0. This provides
chemical plastic manufacturing companies with more opportunities to enhance their production methods and
streamline their operations. There is also considerable potential for product innovation. Companies can
continue to create advanced and environmentally-friendly plastic products to meet the growing consumer
demand for safety and sustainability.

Globalization creates conditions for the development of the international market, allowing companies to
enter new markets and leverage the specific requirements and diverse cultures of each nation. Furthermore,
the trend towards increased social responsibility and sustainability is an opportunity for plastic companies to
demonstrate their commitment to the community and the environment. Global collaboration and strategic
alliances with partners can bring benefits in terms of supply, research, and expanding market access.

5. Conclusion.

Summarizing the analyses and findings on the benefits and drawbacks of globalization for chemical plastic
07.03-BM/ĐT/HDCV/FE 1/0 14/2
1
businesses is a broad and complex topic. However, it can be concluded that globalization has brought
numerous advantages for chemical plastic enterprises in terms of global market competitiveness. These
businesses can capitalize on opportunities to expand production scale and access new markets, leading to
increased sales and revenue.

Nevertheless, globalization also poses several challenges for chemical plastic businesses. One primary
challenge is navigating cultural differences and cultural diversity. These differences can create
complications in communication and collaboration, especially when teams operate in various regions around
the world. Additionally, chemical plastic businesses must contend with diverse legal regulations in different
countries, potentially leading to compliance issues.

To promote positive aspects and minimize drawbacks for businesses overall, chemical plastic enterprises
can seize opportunities to develop sustainable and environmentally friendly products. They can also explore
ways to enhance productivity and reduce production costs by adopting new technologies and optimizing
manufacturing processes. This can help chemical plastic businesses strengthen their global market
competitiveness and position themselves for long-term success.

In summary, globalization has brought numerous benefits for chemical plastic businesses, but it also
presents significant challenges. These enterprises can leverage opportunities to grow and enhance global
market competitiveness by minimizing risks and capitalizing on emerging trends. This approach can assist
chemical plastic businesses in positioning themselves for long-term success.

07.03-BM/ĐT/HDCV/FE 1/0 15/2

1
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