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International Assignment Management: Expatriate Policy and Procedure

Our philosophy.

[Company Name] is a global company that operates over X offices worldwide. The transfer of employees between the various [Company Name] units, from headquarters to subsidiaries, between subsidiaries and from subsidiaries to headquarters, enables our company to better utilize its human resources, while offering efficient support to its business activity. In addition, it enables our executives and professionals to gain international business experience and opens up wider promotion paths.

The objective of this procedure is to define the processes, terms and conditions for transferring personnel from one [Company Name] unit to another and to provide guidelines for the benefit and relocation package for such employees. While differing laws in various countries may influence some aspects of the policy implementation, the basic guidelines are to be maintained in order to ensure a unified company policy.

The effective date of this policy is [Insert Date].

Definitions

Expatriate (Hereinafter “Ex-pat”) - An employee who is relocated from his/her home country to work at one of the subsidiaries of [Company Name] abroad or at Corporate Headquarters for a period exceeding one year.

Host country/ subsidiary - The receiving or destination country/subsidiary of the Ex-pat.

Home country/subsidiary - Originating country/subsidiary of the Ex-pat.

General Approval process for an Ex-pat assignment

The transfer of an employee from headquarters to a subsidiary, between subsidiaries or from a subsidiary to headquarters, is contingent upon joint discussions held between the divisions and the subsidiaries.

The Ex-pat position must be granted budgetary approval from the division and approved by the Corporate HR Forum. The host country has veto power over the corporate offer for all candidates except those in top management positions. In January of each year, the HR Forum will convene in order to discuss general Ex-pat recruitment needs for the upcoming year.

Contract approval process

Contracts of subsidiary management team are coordinated and approved in advance by the relevant Co-President and Corporate VP of HR. The rest of the Ex-pat’s contract is coordinated and approved in advance by the Corporate VP of HR.

The employment offer, including salary, benefits and job description, is generated on behalf of the subsidiary by the host country HR Manager and/or relevant VP.

When an Ex-pat relocates from one subsidiary to another, the receiving HR Manager will transfer the offer to the HR Manager in the Home Subsidiary and to the Corporate VP of HR.

As a rule, the entire process of transferring employees between the various company units (subsidiaries/headquarters) under Ex-pat terms is coordinated by Corporate VP of HR (as described above).

Standard Assignment Period

Ex-pat status is restricted to a period of up to 5 years. After this period, the employee is no longer employed under Ex-pat terms and conditions, but rather, under local terms. Exceptions are granted under very limited circumstances and require written explanations and approval of the subsidiary president and the Corporate VP of HR. Under no circumstances will the extension of Ex-pat status exceed an additional 3 years.

Transferring from one subsidiary to another is considered a new assignment in this context.

Terms of Assignment Termination

Completion of the Ex-pat assignment requires a ninety (90) day mutual notice period. If the Ex-pat assignment is termi­nated by the company for any reason other than a breach of the employment agreement on the part of the employee, s/he will be relocated to his/her home country in accordance with the company’s then-current relocation policy and will be exempt from repaying the standing relocation loan

Relocation Allowance

In the event that the employee resigns from the company or from the assignment, he is required to repay the relocation allowance on a pro-rata basis as well as take responsibility for household moving arrangement and expenses (excluding countries in which the law requires the Company to cover Ex-pat relocation expenses, even in case of employee resignation).

Budget allocation

All Ex-pat benefits will be allocated to the host country budget.

Commitment to Hiring the Ex-pat When His/Her Assignment is Completed

[Company Name] makes no commitment to re-hire the employee in his/her home country after his/her Ex-pat assignment is completed.

However, should the employee work in his host country during the ninety (90) day notice period (see above), the employee will be granted the right to work for three (3) months at the company in the Home country on local terms as determined by the home country HR manager on a case-by-case basis.

Commitment to return to the company upon assignment completion

The employee makes no commitment to return to the company upon completion of his/her assignment. However, s/he may be eligible for repatriation benefits (see “Repatriation Policy & Benefits”) upon return to his/her home country.

Spouse Status/Domestic Partners

[Company Name] will extend spouse status to domestic partners. Ex-pat terms apply to the employee, his/her spouse or domestic partner and their children.

Salary Review

Salary review takes place in accordance with the host subsidiaries policy as approved by corporate policy.

The Ex-pat is responsible for paying any tax liability incurred from benefits and compensation received in both his/her host and home countries (excluding countries in which the employer is required to deduct the taxes from all paid benefits).

Option Plan

Options are granted, if applicable, in accordance with host country policy.

Retention of Home Country Social Benefits

The company will cease to fund payment to retirement plans for Ex-Pats for the period of employment in one of the Company subsidiaries. Following are details on the implementation of the decision:

Ex-Pats Recruited from within [Company Name]

Upon the termination of employee-employer relations with [Company Name] – prior to his relocation to the subsidiary, the Ex-Pat will sign an employment termination agreement with [Company Name]. The amounts accumulated by the employee in various funds, will be released

Ex-Pats Recruited from outside of the Company

In accordance with the above-mentioned policy, no amounts will be allocated to retirement and national insurance to Ex-pats recruited from outside the company as of January 2004.

Ex-Pats Currently in Office

Employees will be granted the option to choose between the termination of employer-employee relations and between the continued payments of funds, up to a ceiling of 5 years after their departure to the host subsidiary – a time in which, according to the procedure, the employees cease to carry Ex-Pat status.

The termination of employee-employer relations, in this context, is accompanied by the release of accumulated funds only, with no supplement. Any employee decision (continued payment of funds or termination of relations) will be backed by a document signed by the employee.

Health Insurance

The Employee and his immediate family are covered by local or international health insurance as per the host country’s policy.

Performance Appraisal

In accordance with host country policy (as per corporate policy).

Recruitment and Selection of Ex-pats

Ex-pat recruitment is conducted either internally (i.e. within the company) or externally.

Internal Recruitment

The recruitment process must include a professional recommendation from the division/unit/subsidiary and personality assessment of the employee and his/her spouse conducted by the HR manager (in Corporate, HR manager of the relevant Division or by the Recruitment manager) and/or by an external assessment agency.

Once a final decision is made in the home country, the internal candidate will be interviewed at the host country.

Should the host country HR manager decide to hire, s/he will issue a contract to the employee in cooperation with the HR manager in the home country.

The home country HR manager is charged with care of the administrative processes surrounding the relocation of the employee, including the signing of a non-paid-vacation/leave of absence agreement, which identifies preservation of rights benefits but otherwise confirms the lack of a contractual relationship between the home country company and the employee.

External Recruitment at Corporate

In cases where there is no suitable internal candidate the Corporate Recruitment manager in cooperation with the HR Manager of the relevant division, will manage the search.

The external candidate will be interviewed by corporate managers and by the HR department. Assuming the candidate makes a positive impression, an external personality and capabilities assessment process of both the candidate and his/her spouse will be performed by a specialized agency.

Once Corporate makes positive recommendation, the candidate will be interviewed by the host country.

An acceptance by the Subsidiary will result in either:

  • The Subsidiary offering the position to the candidate and employing him/her from day one (the preferred option), or:
  • The candidate signing a temporary agreement with Corporate until completion of the training period and/or residency visa procedures. In this case, a secondary employment agreement for the assignment will also be signed with the Subsidiary.

Engagement in an Ex-pat employment assignment is contingent on successful attainment of work authorization in the host country. The process for being granted a work visa differs with the country of destination. Company is responsible for supporting the application for a work visa for the employee and a residence visa for the family.

It is the responsibility of the host country HR manager in coordination with the home country HR manager to take care of the process.

Family Visas

[Company Name] is obliged to support the application of a residency visa only for the Ex-pat’s immediate family (for this matter, the term “immediate family” relates to the spouse and children of the Ex-pat).

The employee has the responsibility to monitor the accuracy and expiration dates of visa documentation for himself and his/her family in order to maintain a lawful working status in the host country.

Language studies

The allotment of English/local language lessons will be approved in accordance with each Subsidiary’s existing policy.

Cross-Cultural Orientation

Written material containing informative details relevant to the country of destination will be delivered to the employee by the HR Department. A complementary cross-cultural workshop will be also coordinated for the employee, his/her spouse and their adult children. The workshop will concentrate on the psychological/emotional stages that the employee and his/her family are likely to face during the transition to a foreign country.

The workshop will be coordinated by the HR Department in the home country once the contract is signed.

Preview Trip

The candidate who expresses a sincere intention to accept the Ex-pat assignment and his/her spouse/domestic partner (if they have school age children) are eligible for a preview trip.

The preview trip is approved for up to 5 working days. It is recommended that the preview trip be combined with a business trip.

The company will pay for round trip economy airfares to the host country and per-diem according to the home country’s per-diem travel policy.

The potential candidate should notify the host country’s HR manager re: his/her preview trip schedule so that proper arrangements can be made.

The potential candidate will meet with his/her direct manager and related business VP’s or managers to learn more about the scope of the job as well as the host country milieu.

House hunting should be done during the preview trip. If possible, it is recommended that an apartment be identified so paperwork can be processed and the apartment readied for when the Ex-pat’s arrival to start his/her assignment.

Visits to potential schools should also take place during the preview trip.

Temporary Housing (at home country)

Expats will be allowed to choose between using their 30 days of hotel and rented car right in their Home Country or at the Host Country, as long as they don't exceed the 30 days period limit.

Special Vacation Days for Arrangement

The Ex-pat is eligible for 5 days vacation leave, in addition to the annual leave, before going on the assignment, in order to arrange his personal matters.

Traveling and Settling-in Policy & Benefits

Cargo Shipment

The company pays for a 20-foot container, insured for up to $40K (US).

It is the responsibility of the host country HR manager to coordinate cargo shipment, except in the case of Ex-pats departing or repatriating from and to Corporate. In such cases, the Customer Department of the Operations Division coordinates the shipment.

For Ex-pats moving from one subsidiary to another, on a sequential assignment, the Repatriation Policy and Benefits re: cargo shipment, shall apply.

No payments will be allocated for the storage of freight for longer than the period required to release the container from Customs.

The company will provide the Ex-pat with a Relocation Allowance to assist with miscellaneous transition expenses. The amount of the allowance will be $3K (US) for singles and $4K (US) for couples with or without children.

The payment will be provided in the home country or upon arrival in the host country as per local procedures.

If the Ex-pat resigns before completing two years of his/her assignment, he/she will be required to pay back the Relocation Allowance to the company on a pro-rata basis.

Household Goods Loan- Company Inc.

Upon arrival at Company Inc., the Ex-pat is eligible to apply for an additional no interest loan of up to $2.5K (US) to assist with miscellaneous costs.

The loan is repaid as per subsidiary policy.

Temporary Housing and Rental Car

Upon arrival at the country of destination, the company will pay for car rental and hotel accommodations for a period of up to 30 days. During this time the employee is expected to make longer term automobile and housing arrangements.

Special Vacation Days for initial settling

Upon arrival to new country the Ex-pat is eligible for 5 days vacation leave, in addition to the annual leave, for arranging his personal matters.

At-Post Policy & Benefits

Annual Leave- as per host country policy.

Holidays and Leave - as per host country policy.

Housing- as per host country policy.

Car- as per host country policy.

Ex-pats are eligible for home leave after each year, as long as they have a balance of one-year service commitment in the host country upon return from home leave.

Home Leave Duration

The duration of the home leave will be up to 21 days, as listed below:

5 days – Training and meetings that will be regarded as working days at Corporate headquarters or at the Home Subsidiary headquarters. In case there is no need for the employee to attend any business meetings/training or if his home country is far from subsidiary headquarters, these 5 days, if taken, will be on the account of the employee’s annual vacation days allotment together with the other 10 days mentioned below.

6 days – Weekends

10 days – Annual vacation days

[Company Name] will cover the round-trip coach fare from and to the country of origin for up to a 21-day visit by the employee and his/her family. In the event that the employee’s family extends its visit beyond the 21-day period and in the event that this extension incurs additional costs to the tickets, these costs will be borne by the employee.

Home Leave Expenses

The Ex-pat is eligible for a special (taxable) allowance towards expenses during home leave:

Senior Subsidiary managers (Presidents/Vice Presidents) will be eligible for $2,000 (US). They are also eligible to a car for their use during the working days they are requested to work during their home leave period, up to a 5 days limit. Any other car expenses during the Home Leave period are covered by the $2,000 that Senior Subsidiary Managers are entitled to as Home Leave Expenses.

Other Ex-pats will be eligible for $1,300 (US).

Application for Home Leave

Ex-pats will fill the home leave application form and obtain direct manager’s, relevant VP’S and host country HR manager’s approvals prior to taking the leave. This process should take place 3 months prior to the starting date of the planned home leave.

Children’s Education

[Company Name] pays for children’s education from Kindergarten through Secondary School or High School Grade 12 equivalent or from age 2 to age 18, depending on local practice.

In countries where the local school system is inappropriate or in an unfamiliar language, International/ American/ British/ Canadian School may be an appropriate alternative.

Educational expenses supported by the company include the following:

  • School registration fee
  • Tuition fee
  • School bus transportation fee
  • The company does not pay for the following:
  • Summer school
  • Summer camp
  • School field trip

Academic Studies

Ex-pats (who are not subsidiary management members) will have the option to apply for academic studies, with a subsidy of the company, according to the local subsidiary’s terms and procedures.

Ex-pats who are subsidiary management members (VP’s and Branch managers) will have the option to apply for academic studies, with a subsidy of the company (based on the subsidiary terms and procedure). The applications will be submitted with the subsidiary recommendations to Corporate HR VP for final approval

Family Member in Home Country

The company will provide a round trip economy air ticket for the shortest route to the host country as per the home leave policy of frequency of the Ex-pat, for family member/s who continue to reside in the home country. Family member/s in this case includes sons and/or daughters of the Ex-pat until age 18 or completion of mandatory military service.

Death in the Family

In the event there is a death in the Ex-pat’s family or the Ex-pat’s spouse’s family the company will pay for round trip economy air tickets to the Ex-pat’s home country for either the Ex-pat or his/her spouse. The Ex-pat is entitled to 7 working days paid leave under such circumstances. For the matter of this paragraph, “Family” is defined as: father, mother, spouse, son, daughter, brother or sister.

Tax Preparation Assistance

The Ex-pat is eligible for tax consultation reimbursement as per host country policy.

Repatriation Policy & Benefits

The benefits set forth below will be valid for a period of up to three months after the date of assignment completion and only in conjunction with a bona fide move of a permanent nature back to the employee’s country of origin or to a subsequent assignment in another subsidiary.

Upon assignment completion the company will arrange and pay for the Ex-pat’s cargo shipment. An Ex-pat with 3 or more children will be eligible for a 40-foot container insured for up to $40K (US). An Ex-pat with fewer than 3 children is eligible for a 20-foot container, insured for the amount of up to $40K (US).

It is the responsibility of the originating country HR manager to coordinate the shipment, except in the case of Ex-pats repatriating to Corporate. In this case, the Customer Department of the Operations Division coordinates the shipping.

No payments will be allocated for the storage of freight in the host or home country for a period exceeding that required to release the container from Customs.

Special Vacation Days for Arrangement (Host Country).

The Ex-pat is eligible for 5 days vacation leave, in addition to the annual leave for arranging his personal matters, before departing to his/her home country or before going on his/her next Ex-pat assignment.

Temporary Housing and Rental Car (Host Country)

The company will pay for car rental and hotel accommodations for a period of up to 12 days if needed, at the employee’s regular location, prior to the Ex-pat departure from the host country. The host country HR manager is responsible for the coordination of these arrangements.

Benefits for Employees Returning to Work at Company in Home Country

The employee is eligible for 5 days vacation leave, in addition to the annual leave, to assist with his/her settling-in arrangements.

Repatriation Grant

The company will reimburse the employee for up to $1,000 (US), as per receipts, to help with repatriation expenses. “Repatriation Expenses” include such expenses as temporary accommodations, rental cars and tutoring.

Responsibility

This procedure may be changed occasionally. All changes require the approval of the Corporate VP Human Resources.

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Faculty and Administrators on a Short-Term Global Assignment Policy

Please Click Here for PDF Version of the Policy

It is the Policy of New York University (“the University” or “NYU”) that the University seeks to have its affairs conducted consistent with applicable laws and regulations, ethical norms, and accepted best practices. The University’s global assignment policies are grounded in the principles of commitment to employee safety and health/welfare, and of compliance with local laws and regulations.

Below is a list of contents of this policy.  Please view the entirity of this policy by clicking on the above PDF link.

                                                 List of Contents

INTRODUCTION ……………………………………………………………...…….........3 1. Policy Interpretation and Revision………………………………………………... 3      Application Outside of the United States………………………………… 3      Family………………………………………………….………… ……… 4      Dual Career Couples: Both Employed by NYU…………………………...4      Dual Career Couples: One Employed by NYU…………………………....4      Currency…………………………………………………….……………. 4      Reimbursement…………………………………………………………… 5      Policy Exceptions………………………………………………………… 5 2. Assignment Letter………………………………………………………………… 5

COMPENSATION OVERVIEW ………………………………………………….…….. 5 3. Objectives………………………………………………………………….……… 5 4. Base Compensation………………………………………………………………... 6       Base Salary……………………………………………………………….. 6 5. Employee Benefit Plans……………………………………………….………………… 6      Medical Insurance………………………………………………………… 6      Retirement Plans…………………………………………………….……. 6

PREPARATION FOR GLOBAL ASSIGNMENT AND RELOCATION PHASE …………………………………………………………………………………….. 6 6. Pre-Assignment Orientation………………………………….…………………… 6 7. Medical Examination/Immunizations…………………………………………….. 6 8. Travel/Visa Documents………………………………….………………………... 7 9. Tax Orientations…………………………………………………………………... 7 10. Cultural Orientation……………………………………………………………….. 7 11. Shipment of Personal Belongings……………..……………………………......... 7 12. Home-Country Housing………………………………………………………….... 7 13. Temporary Living………………………………….……………………………… 8 14. Miscellaneous Relocation Allowance……………………………………………....8 15. Travel to/from the Assignment………………………………………………….......8 16. Destination services…………………………………………………………………9

ON ASSIGNMENT PHASE ……………………………………………………………….9 17. Per Diem/Cost-of-Living……………………………………...…………………….9 18. Host-Country Housing………………………………………………………..........10 19. Host-Country Transportation………………………………………………………11 20. Children’s Educational Assistance…………………………………………….......11 21. Tax Return Preparation Assistance / Tax Protection Policy…………………........12 22. Administrator Vacation, Public Holidays, and Working Schedule……….……….12

END OF ASSIGNMENT ………………………………………………………................12 23. Repatriation…………………………………………………………………...…...12 24. Assignment Extension…………………………………………………………......12 25. Sequential Assignment………………………………………………………….....12 26. Resignation and Termination…………………………………………….……......13

POLICY DEFINITIONS …………………………………………………………………..13 APPENDICES A. Shipment of Personal Belongings Exclusions….....................................................16 B. Cost of Living Allowance (COLA)…………….………………………………….18

NYU is a Global Network University that operates in an expanding global environment. The purpose of this Policy is to define the principles, procedures, compensation and other benefits applicable to Faculty and Administrators who accept global assignments covered by this policy.

This Policy applies to all Faculty and Administrators who accept assignments away from their home country to work at an NYU degree granting campus for a period of over 7 weeks, but less than 12 months.¹

The Policy is intended to apply to Faculty and Administrators who are asked by the University to work at an NYU degree granting campus. For purposes of this Policy, home country refers to the point of work origin of the Faculty or Administrator and not to their country of citizenship or nationality.

¹ It is the University’s policy to assist the Faculty and/or Administrator during the agreed upon length of assignment.  If the Faculty or Administrator decides to arrive earlier or stay longer in the host location beyond the agreed upon time for reasons unrelated to the assignment, then costs associated with the additional time will be the Faculty or Administrator’s responsibility.  For example, if an appointment is for an academic year, the University may provide a per diem or living allowance for the academic year only.

  • Dates of official enactment and amendments: Aug 9, 2016
  • History: blank
  • Cross References: blank

About This Policy

Effective Date May 1, 2012 Supersedes N/A Issuing Authority Executive Vice President of Operations Responsible Officer Senior Vice President for Human Resources and Global Support

Assignment-Related Benefits:  A general term covering all elements of remuneration provided in connection with a temporary transfer across national borders.

Cost-of-Living-Allowance (COLA):   A differential payment to the Faculty or Administrator to address differences in purchasing power between home and host countries.  It is usually derived by applying a cost-of-living index to a Faculty’s or Administrator’s home country Spendable Income. Please note: A Faculty on a short-term assignment will receive a COLA or per diem (defined below), but not both.

Cultural Orientation:  Education in the customs, practices and/or languages of the host country for the Faculty/Administrator and/or accompanying qualifying family to familiarize them with the new environment in which they will live and work during the global assignment most often provided by a third-party vendor.

Destination Services :  Assistance provided to the Faculty or Administrator and qualifying family upon arrival in the host country to help them settle into their new surroundings.  Usually includes assistance in finding a residence, arranging schooling for dependent children, and guidance regarding shopping, transportation and drivers’ licenses. Most often provided by a third-party vendor.

Home Country:   The location where the Faculty or Administrator worked prior to the global assignment , and to where it is intended he/she will repatriate at the end of the assignment(s). The home country may or may not be the Faculty or Administrator’s country of citizenship or residence.

Host country:   Location across national borders to which the Faculty or Administrator is temporarily sent to work from the home country .

Per Diem :  A cash payment to the Faculty or Administrator to cover certain temporary living expenses, usually meals and incidental expenses, expressed as a daily rate.  Please note: A Faculty on a short-term assignment will receive a COLA (defined above) or per diem, but not both.

Pre-Assignment/Pre-Departure:   The period of time after a candidate for assignment has been identified, but prior to his/her departure from the home country . 

Miscellaneous Relocation Allowance:  A lump sum cash payment to the Faculty or Administrator to cover the cost of incidental expenses not specifically covered by other aspects of the University’s Short-Term Global Assignment Policy .

Repatriation:   The return of the Faculty or Administrator to the home country at the completion of the assignment.

Short-Term Assignment:  A temporary transfer across national borders that is greater than 7 weeks but less than 12 months (e.g., an academic semester). 

Spendable income:     The portion of base salary that is normally devoted to the purchase of goods and services (e.g. food, clothing, entertainment, medical care). This amount is not a fixed percentage of base salary; rather, it varies according to nationality, income level, and family size. Home spendable is what one would spend in the home country. Host spendable refers to what one would need to spend in the host country.

Tax Orientations:  A meeting or discussion between the Faculty or Administrator and a tax service professional to discuss the income and social tax implications of the assignment for both the home county and the host country .

Tax Preparation:   Services of a tax professional to prepare the Faculty/Administrator ’s home country and/or host country tax returns.

Tax Protection/Protect :  A compensation methodology for calculating the Faculty’s or Administrator’s share of their worldwide tax burden by attempting to ensure that the employee is financially “no worse off” than he/she would have been had the assignment not taken place.  

Temporary Living:  The period of time between the Faculty or Administrator leaving permanent accommodation in the home country and moving into permanent accommodation in the host country , which is limited to 30 days under the NYU Short-term Global Assignment Policy.

Faculty and Administrators on Global Assignments Policy

Faculty Housing Policy

global assignment policy

5 Essential Topics to Include in a Global Assignment Letter of Understanding

By Stephanie Dedekind, GMS

To ensure the success of a global assignment, it is crucial for employers to create a well-crafted global assignment letter of understanding. This document should clearly outline the important details and benefits of the assignment, leaving no room for misinterpretation.

Once the letter of understanding addresses specific information regarding the scope of the assignment, it can delve into the specifics of the employer’s global mobility policy and explain the benefits the employee will receive.

Explain Your Global Mobility Policy

Summarize the relevant portions of your global mobility policy that apply to the employee. This should include information on relocation expenses, moving household goods, tax implications and assistance, immigration, and housing and settling-in assistance. These aspects often carry significant costs and may cause stress for the employee.

Relocation Expenses

When writing the letter, review your policies to determine relevance to the employee. While you should not copy your policy verbatim, you should summarize:

  • Specific expenses and the amounts the company pays for directly
  • Types of expenses eligible for reimbursement, along with any limits. Note whether the employee will need to document each expense, submit a consolidated summary, or receive a lump sum amount for miscellaneous expenses
  • Ongoing allowances for specific benefits
  • Expenses the employee bears responsibility for paying
  • Repayment agreement terms

Moving Household Goods

Movers carrying sofa outside truck on street

Global movement of household goods will typically include sea and air shipments and long-term storage. The letter of understanding should clearly outline coverage. Typical benefits include a 20-foot or 40-foot container and 500 pounds for an air shipment. Typically, employers provide long-term storage only for employees on assignment for the duration of the assignment.

Employers should also consider the cost of storage and valuation coverage for household goods. Your letter should specify the amount your company will pay for household goods transport, storage, and valuation along with any limitations or restrictions.

Tax Implications and Assistance

Highlight the significant tax implications associated with global assignments and relocation. Explain the assistance provided, such as pre-assignment/relocation orientation with a third-party tax provider, tax return preparation assistance, and tax equalization. Clearly define the responsibilities of both the employee and the company. If applicable, mention the possibility of including a tax equalization addendum for the employee to sign, as suggested by the company’s tax provider.

Immigration

The letter of understanding should emphasize the importance of compliance with global immigration laws and should outline the assistance provided by the immigration partner or department. Employers should clearly document employees’ responsibilities to provide accurate and timely information and to follow all instructions regarding host country travel limitations. The assignment or relocation cannot begin until the employee has obtained all required immigration documents.

Housing and Settling In Assistance

Getting your employee and their family settled into a new residence helps them return to full productivity quickly. Each employee is unique. Some may need temporary housing while they search for a new residence and your letter should reflect the level of assistance your company provides.

  • Temporary Housing: Summarize what provisions the company makes for temporary living and for how long
  • Home Finding Travel: Summarize the assistance the company provides, such as home finding trips. Include the number of trips allowed, the expenses covered and the family members approved
  • Destination Services: Summarize the services the company provides, which might include home finding assistance, area orientation, contacts with local schools, colleges, medical facilities, etc.
  • Long-Term Housing (Assignments Only): Summarize the housing assistance provided, including monthly housing allowance based on family size and location, method of payment, utilities included, and employee responsibilities for maintenance and upkeep

In conclusion, a well-crafted letter of understanding should focus on the employee and highlight the benefits of the new role, generating enthusiasm for the opportunity. Clearly outline expectations and the employee’s responsibilities to avoid any misunderstandings. Summarize the relevant points from the global mobility policy, with a particular focus on the five important topics discussed above.

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Global Assignment - Definition, Importance, Steps & Example

What is global assignment.

Global assignments are business projects which are allotted to some employees outside the home country. Global assignments are employers assigning their employees on projects which are globally implemented. Global assignments are mostly taken place in multinational companies and may involve employees to relocate from their current country to a different country where the assignment is assigned.

Since globalization has taken place rapidly and the world has become more connected, it has become a very common phenomenon. Many countries face skill shortage or require an expert for a particular assignment so they would hire the person with the requisite skills or knowledge from other countries and pay the person a hefty compensation as demanded by the person.

Steps in Managing Global Assignment

Some steps in managing global assignments & international projects are:

1. Evaluating objectives of the international project

2. Identifying team members & giving pre-requisite training

3. Pre-departure preparation of activities & work to be done

4. On job activities on global assignment at international location

5. Project completion

6. Evaluation & reassignment if required

Global Assignment

Importance of Global Assignment

Global assignments as identified by experts in international human resource management are of three types

1. Technical assignments: Employees may be assigned global assignments if they have the technical skills that are required by the MNC for a particular assignment and the MNC is not able to find anyone as capable as that person internally and in that particular country, if a person is located within the MNC in another country then that person is sent on a technical assignment.

2. Developmental assignments: Developmental assignments are typically used to develop a project or concept that is new to a different location or develop skills in a different location which is not implemented in that location, it is also used by institutes to bring in faculties from different parts of the globe to give the students an exposure to different perspectives and cultures and their thoughts on the scenario of the subject.

3. Strategic Assignments are global assignments in which a key partner is sent to launch a product in a key location, develop the market or get necessary changes in the business strategy or even sign Memorandum of Understandings and Joint Venture deals.

Advantages of Global Assignments

Some advantages of global assignments are

1. Skills and knowledge which are not available in a country can be brought from other countries.

2. MNC’s are able to get their projects done more effectively and not having the problem of talent not being available.

3. Employees may be motivated to join an MNC which assigns global assignments to its employees regularly.

Example of Global Assignment

Here is an example of global assignment for a hypothetical organization Company A. Company A could not find a person who could communicate in French, German and Hindi in their main headquarters in USA as they felt that there would be a gap in understanding if the language is translated to English, and then to either of these languages. So, since they did not find the any person who had proficiency in these three languages in their headquarters and started finding for a person with the language skills throughout all their office. Company A found a person in their international office in India with the knowledge in these three languages. So, they assigned her the project under a global assignment and she was asked to relocate to the main headquarters located in the United States for the duration of the project.

Hence, this concludes the definition of Global Assignment along with its overview.

This article has been researched & authored by the Business Concepts Team . It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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Multi-Domain Security Management R81 Administration Guide

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Global Assignments

A global assignment is a Multi-Domain Security Management system object that assigns a global configuration to one specified Domain . You create global assignments to assign different combinations of Global Access Control Policies, Global Threat Prevention Policies, and global object definitions to different Domains .

When you create a new global assignment, it automatically assigns the specified global configuration to the specified Domain . It also publishes the assignment and updates local Domain Policies.

When you do one or more of these actions, you must publish the Global Domain session and reassign the global configuration:

Add, delete, or change rules in a global configuration

Add, delete, or change user-defined objects in a global configuration

Define the SmartEvent object in the global database

Change the definition of a global assignment

The assign/reassign action does not automatically install Policies.

Configuring an Assignment

To create a new global assignment:

Go to Multi- Domain > Global Assignments .

Click Assign > New Assignment .

In the New Assignment window, select a Local Domain .

Optional: Select a Global Access Control Policy for this local Domain .

You can click Advanced to open the Advanced Assignment window to assign the selected Policy:

Only to the specified, local Domain Policies

To all local Domain Policies, except for those explicitly specified

Optional: Select a Global Threat Prevention Policy for this local Domain .

Optional: Enable Manage protection actions .

Click Assign .

In the confirmation window, click Publish & Assign .

The system creates a task, which:

Publishes the changes

Changes the assignment status to Up to Date

To change an existing global assignment:

Connect to the Multi-Domain Server with SmartConsole .

In the Global Assignments view, double-click a Domain .

In the Assignment window, follow steps 4-6 above.

The system creates a task which:

Publish the changes

Reassigning

When you make changes to the global configuration items, the assignment status changes to Not up to date . The assignment status does not change if you make changes to the local Domain Policies.

To reassign global configurations:

Connect to the Multi-Domain Server with SmartConsole , and then click Global Assignments .

In the Global Assignments window, right-click one or more Domains .

You can reassign to more than one Domain at the same time.

Click Reassign .

Updates the local Domain and its Rule Base

Changes the assignment status to Up to Date .

Handling Assignment Errors

Global assignments run as a task that you can monitor while you work on other tasks.

To monitor assignment/reassignment tasks:

In the Multi- Domain view, click the task information area.

The Recent Tasks window opens.

Find the assignment task.

If your task does not show, click Show More .

Click Details .

The Assignment Task Details window shows the task progress and details.

If the task fails and returns an error message, correct the error, and then try to assign/reassign the global configuration again.

Some common errors include:

Global objects with duplicate or illegal names

Deleted global objects used in a rule

Global rule validation errors

Deleting a Global Assignment

When you delete a global assignment, the global configuration rules and objects no longer apply to its Domain .

Best Practice - Immediately create a new global assignment so that Domain Security Gateways continue to enforce global configuration rules.

To delete a global assignment:

In the Global Assignments view, select a Domain .

Click the Delete icon on the Actions toolbar.

In the Remove window, select an assignment, and then click Remove .

Global Assignment Status

You can see the global assignment status in the Assignment Up to Date column, in the Multi- Domain > Global Assignments view. For each Domain , the date of the last assignment shows together with a status icon:

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Academic Expectations Policies

Classroom expectations.

The instructor is responsible for setting standards for all physical or virtual classroom conduct, behavior, and discipline. Only enrolled students, administrative personnel, and persons authorized by the instructor are permitted access to physical or virtual classrooms. University policy and Colorado state law prohibit all forms of disruptive or obstructive behavior in a physical or virtual classroom or any action which would disrupt scheduled academic activity. All communications with instructors, whether in class, face-to-face, on paper, or by telephone, email, or other means are subject to the same standards for conduct, behavior, and discipline as classroom behavior. Standards of conduct outlined elsewhere (Student Conduct Code, Sexual Harassment Policy, etc.) also apply.

Plagiarism is the adoption or reproduction of ideas, words, or statements of another person as one’s own either knowingly, carelessly, or without acknowledgment. Please  review the complete Plagiarism Policy by clicking here .

Learning Management System And Campus Network

CSU Global uses Canvas as the learning management system for the facilitation of communication between faculty and students, submission of assignments and posting of grades. Due to upgrades or a technical outage, if Canvas is unavailable for an extended period of time, contact your instructor if due dates will be missed.

Military Friendliness Academic Policy

Veterans and active duty military personnel with military obligations are encouraged to communicate to the faculty about these obligations. These communications need to occur within the first two weeks of a course, or as soon as military obligations are identified, and the student needs to provide relevant documentation to the faculty. If necessary, once the student has self-disclosed and provided proper documentation to the faculty, reasonable arrangements will be implemented to help the student complete their academic coursework.

Citing Sources With APA Style

All students are expected to follow APA 7 formatting for all assignments. For details, please review the APA 7 guidelines within the CSU Global Writing Center. A link to this resource should be provided within most assignment descriptions in your course.

Satisfactory Academic Progress

Satisfactory Academic Progress (SAP) applies to all students and denotes successful completion of coursework towards a degree in each trimester. Students who fail to achieve minimum standards for grade point average and/or course completion rate (CR) in a Maximum Time Frame (MTF) will face academic consequences; up to and including university withdrawal and loss of eligibility for all types of federal and state aid administered by CSU Global.

The following credit hour guidelines are used when determining Satisfactory Academic Progress:

  • All CSU Global credit hours attempted and earned are counted in the evaluation of SAP.
  • All transferable credits are counted as credit earned and will count towards MTF and CR but not in the cumulative GPA calculation.
  • Incomplete grades in courses will count as credits attempted but not earned until the final grade has been posted, at which point SAP will be re-calculated for MTF, CR, and cumulative GPA with the final grade.
  • All repeated courses count as credits attempted but not earned and count toward MTF and CR. Repeated courses do not count toward cumulative GPA except for the final grade received on the last repeat of a course.
  • Course withdrawals (grades of W) count as credits attempted but not earned, and count towards MTF and CR but not toward cumulative GPA.
  • Students on SAP Probation may be ineligible to transfer to another program until SAP has been met, or an appeal has been approved.

Good Academic Standing

All students will be evaluated for SAP at the end of each trimester. To remain in Good Academic Standing, students must maintain the following standards:

To remain in Good Academic Standing, students must maintain a cumulative grade point average (GPA) of at least 2.00 and a minimum course completion rate of 66.66% of all courses attempted. The MTF for undergraduate programs is 150% the normal duration of program as measured in credit hours.

Note: The minimum course completion rate of 66.66% takes effect in July 2016. Any prior terms are based on the previous minimum course completion rate of 67%.

To remain in Good Academic Standing, students must maintain a cumulative grade point average (GPA) of at least 3.00 and a minimum course completion rate of 66.66% of all courses attempted. The MTF for graduate programs is 150% the normal duration of program as measured in credit hours.

SAP Warning

Active students who fail to meet the minimum SAP standards after one trimester will be placed on SAP Warning. All students on SAP Warning will receive academic advisement to assist them in improving their academic progress.  Financial aid students in SAP Warning status remain eligible for Title IV funds.

  • Students on SAP Warning who achieve the required SAP minimums at the end of their next trimester will be placed back into Good Academic Standing.
  • Students on SAP Warning who do not achieve the required SAP standards at the end of their next trimester will be placed on SAP Probation.
  • Students on SAP Warning who have not registered and completed coursework within 12 months will be administratively withdrawn.

SAP Probation

Students will be placed on SAP Probation if they fail to meet the minimum SAP standards while on SAP Warning. SAP Probation status is noted on the transcript until the student returns to Good Academic Standing. In addition, students will receive notification of SAP Probation status from the Office of Student Affairs. All students that are placed on Academic Probation must submit an Academic SAP Appeal form in order to continue taking courses during the Probation period. Academic progress during the warning period will be reviewed, and if approved the student will be issued an Academic Plan that will detail what the student must complete in order to get back into good academic standing.  The university will only approve a financial aid appeal if it determines that the student had a documented extenuating circumstance that occurred and prevented the student from successfully completing the coursework, and that the student will be able to meet minimum standards for Satisfactory Academic Progress during the next trimester based on the academic plan developed by the institution.

  • If a student meets the required standard within one trimester, he or she will be placed back into Good Academic Standing.
  • If a student cannot meet the required standards within one trimester, the student must have an academic plan on file in order to be able to continue.
  • If a student cannot meet the required standards within two trimesters in SAP Probation, he or she will be placed on Academic Suspension.
  • Students on SAP Probation who have not registered and completed coursework within 12 months will be administratively withdrawn.

Students who are denied academically will be suspended and may file a Provost appeal. If a Provost appeal has not been approved by the end of the trimester in which they were denied they will be withdrawn from the university. Financial aid students in SAP Probation status must appeal to be eligible for Title IV funds, and may not receive financial aid for more than two trimesters of SAP Probation. Please see Financial Aid Satisfactory Academic Policy for more information on federal aid eligibility

SAP Academic Suspension

Students who fail to clear SAP Probation status will be placed on Academic Suspension. Students placed on Academic Suspension cannot re-enroll at CSU Global unless approved by the university via appeal.

Students on Academic Suspension who successfully appeal their suspension can return to the university in SAP Probation II status. Students on SAP Probation II will re-enter the university under the current catalog and university requirements. Students may be granted an administrative waiver to return under their previous program based on the committee decision. Students on SAP Probation II will remain under the guidelines of the catalog in effect at the time of re-entry to the University. Suspension Appeals must be submitted to the Office of Student Affairs at least two (2) weeks prior to the start of the term in which a student plans to re-enroll. Students who are approved to return under SAP Probation II status are ineligible for Title IV funds. Students placed on Academic Suspension retain limited access to their Student Portal for account information and student services.

Students on Academic Suspension who successfully appeal their suspension must enroll and complete classes in the next available term or the appeal will be negated and the student will be suspended.

Appeal Process For SAP Academic Suspension

Students who wish to appeal their Academic Suspension are responsible for initiating the process by submitting a SAP Suspention Appeal form to the Student Appeals Committee. Appeals will only be considered if all outstanding student account balances have been paid. If additional college credit has been earned since the last enrollment with CSU Global, the student should submit official transcripts as part of their appeal. If a suspension appeal is approved, students may be required to pay cash until they have returned to good standing and are eligible for federal financial aid.

The Appeal Letter must address the following questions:

  • What extenuating circumstances occurred during your previous enrollment to prevent you from successfully completing your coursework?
  • What are your goals in pursuing a degree?
  • How will you adjust your schedule and commitments to ensure that you have at least 10 hours per week to devote to class participation?
  • What is your support network to ensure that you will be able to keep your commitment to school work? How will the people supporting you help to ensure your success?
  • What plans will you have in place to address the possible obstacles that could arise, i.e. computer breakdowns/access issues, changes in commitment or needs related to work, family needs, etc.?
  • How will you communicate with your advisor, instructor and/or the Office of Student Success when you encounter issues or concerns?
  • How can CSU Global best support you accomplish your goals and help to keep you on track?

Students who are denied a suspension appeal may file a Provost appeal. If a Provost appeal has not been approved by the end of the trimester in which they were suspended they will be withdrawn from the university. Students on Academic Suspension who successfully appeal their suspension will be allowed to take courses under a SAP Probation II status with an approved academic plan. Students who do not meet the conditions of the academic plan will be dismissed from the university.

Late Policy

The academic week at CSU Global begins on Monday and ends the following Sunday.

CSU Global has designed programs and courses around best practices in adult and online learning theory. Courses are offered in an eight (8) week accelerated format. Therefore, it is expected that students will gain maximum benefit from courses and stay on pace for successful completion when they are participating fully in each week's activities and completing each week's assignments according to the course schedules. The CSU Global late policy supports maximum classroom success.

Discussion Boards (DB)

The Original Post must be completed by Thursday at 11:59 p.m. MST and Peer Responses posted by Sunday at 11:59 p.m. MST. Please note that late posts will not be accepted after Sunday at 11:59pm MST

Mastery Exercises (ME)

To maximize learning, it is strongly recommended that students complete Mastery Exercises no later than one week after the assigned module. However, students may access and retake mastery exercises until they achieve the score they desire through the last day of class.* Attempts completed after the last day of class will not be accepted unless an Incomplete Grade Request has been approved.

* For courses utilizing Cengage MindTap and Pearson's MyLab and Mastering software, Mastery Exercises are limited to 3 attempts and must be completed during the week that they are assigned. The late policy goes into effect after midnight the Sunday the week the module ends. Exams do not have a late policy, as they are required to be finished during the midterm and final week, respectively.

Critical Thinking (CT) And Portfolio Milestones

CT assignments and milestones are due Sundays at 11:59 p.m. MT. Students are permitted a one week (7 day) grace period during which they may submit an assignment after the original due date without incurring a penalty. Papers submitted between 8 and 14 days after the original due date will be accepted with a potential 10 percent total reduction in grade for late submission. Papers submitted 15 or more days beyond the original due date will not be accepted unless the student has made arrangements with the instructor prior to the original due date of the assignment. Any arrangements for extension must identify the assignments to be included and a due date. Assignments not submitted within 14 days of the original due date will not be included in a request for incomplete grade. All outstanding CT assignments, milestones, and the portfolio project must be submitted no later than the last day of class. No assignments will be accepted after the last day of class unless a student has requested and been approved for an incomplete grade in accordance with the Incomplete Policy.

Portfolio Projects

No late Portfolio Projects will be accepted beyond the last day of class unless a student has requested, and been approved for an incomplete grade in accordance with the Incomplete Policy.

Student Attendance

Students are expected to actively engage in coursework every week in order to effectively master the course material. Active engagement is defined at CSU Global as a submission of an assignment to the grade book, completing a mastery exercise, posting a response to a discussion board, or responding to a student's/instructor's post on a discussion board.

Academic engagement will be monitored on a weekly basis. Students who have not actively engaged for 14 consecutive days will receive an At-Risk Email requesting that the student academically engage in their course within seven days or they will be administratively withdrawn from courses. If the student has not participated after 21 days, the student will be administratively withdrawn from the course.

Students are still responsible for all tuition charges related to courses if a student is withdrawn for non-attendance after the drop deadline each term. Withdrawal for non-attendance may have an impact on financial aid eligibility.

Course Evaluations

The faculty and administration of CSU Global value constructive and professional feedback from students. Information from the course evaluation is used for program and college accreditation. This information also provides faculty with formative feedback that could be used to impact and improve future instruction. The course evaluation is completed electronically by the student. Before completing a course evaluation, a student should reflect on their learning experience in order to provide thoughtful responses to the questions asked in the evaluation. The faculty and administration expect students to adhere to the tenets of professionalism when rating the course and faculty, especially when providing written comments. Any irrelevant or inappropriate comments will not be considered in relationship to impacting course instruction or as evaluative of faculty performance.

Argument: How Policymakers Should Handle a Fragmenting World

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How Policymakers Should Handle a Fragmenting World

A top imf official on avoiding the worst-case scenario of a new economic cold war..

We are at a turning point. Trade is fragmenting as many countries erect barriers in the name of “friendshoring,” “de-risking,” and “self-reliance.”

Countries may have valid reasons for pursuing these policies, such as the need to strengthen national security and build resilience. And in the short term, some nations may benefit. If the trend continues, though, we could end up in a new cold war. And the costs—including less peace, less security, and less prosperity—will overwhelm the benefits. Policymakers undoubtedly face difficult trade-offs between minimizing the costs of fragmentation and maximizing security and resilience. But at the same time some general principles can ensure the world does not descend into its worst-case economic scenario.

This is not the first time that geopolitical considerations have impeded global trade and capital flows.

World War I brought a golden era of globalization to an abrupt end, with world trade collapsing as a share of income. The protracted economic hardship that followed paved the way for the rise of nationalist and authoritarian leaders who later plunged the world into World War II. A bipolar world emerged with two superpowers—the United States and the Soviet Union—divided by ideology as well as radically different political and economic structures. Poised precariously between them was a set of nonaligned countries.

This Cold War period, between the late 1940s and late 1980s, was not one of deglobalization—it was in fact marked by a rising ratio of global trade to GDP, driven by the postwar recovery and the trade liberalization policies adopted by many countries in the Western bloc. But it was a period of fragmentation, as trade and investment flows were shaped by geopolitical considerations. During this time, trade between opposing blocs collapsed from around 10-15 percent to less than 5 percent of global trade.

There are parallels today. Over the past five years, threats to the free flow of capital and goods have intensified as geopolitical risks have grown.

Some measures directly target trade and investment: for example, tariffs on aluminum and steel or export restrictions on critical minerals and agricultural products. Other behind-the-border measures indirectly affect trade flows, such as initiatives to boost domestic semiconductor manufacturing and local content requirements.

Around 3,000 trade-restricting measures were imposed in 2023, nearly three times the number imposed in 2019. Meanwhile, multinational firms are increasingly discussing issues such as reshoring, nearshoring, friendshoring, and deglobalization in their earnings’ calls.

But while the driving force behind today’s fragmentation is similar to that of the Cold War—that is, the ideological and economic rivalry between two superpowers—the stage is fundamentally different.

To start, the degree of economic interdependence between countries is higher today. Global trade to GDP is now 60 percent, compared with 24 percent during the Cold War. Economies have become much more integrated into the global marketplace, and global value chains are more complex. This will likely raise the costs of fragmentation.

FP LIVE : Is the global economy in better shape than we expected in 2024? And if so, how do we keep it that way? Gita Gopinath joined FP’s Ravi Agrawal to discuss. Watch the full conversation.

There is also greater uncertainty around who is in which bloc. During the Cold War, countries tended to clearly align with either the United States or the Soviet Union. Today, within-country swings in the ideology of political leaders are more common, making it difficult to pin down allegiances.

Nonaligned countries now potentially have greater economic heft in terms of GDP, trade, and population. In 2022, more than half of global trade involved a nonaligned country. Given their increased economic integration, these countries can serve as “connectors” between rivals, benefiting directly from trade and investment diversion.

Still, signs of growing fault lines may raise the question: Have we entered a period of deglobalization? If we define deglobalization as a decline in global trade relative to output, then the answer is no—the share of global trade in world GDP today has remained relatively stable, fluctuating between 55 and 60 percent since 2011.

There are, however, signs of increased fragmentation.

Amid slower global growth and the post-pandemic rotation of spending from goods to services, and since the start of Russia’s war in Ukraine, trade has slowed everywhere. However, trade between blocs has slowed much more than trade within blocs. This is especially true in strategic sectors, such as chemicals and machinery, that are used to develop several products, including low-carbon technologies.

There are also clear signs that global foreign direct investment (FDI) is segmenting along geopolitical lines. After Russia’s invasion of Ukraine, the share of announced FDI projects declined more between blocs than across blocs. Meanwhile, about half of announced FDI projects were in nonaligned countries—a sharp increase.

Direct links are also being severed between the United States and China. China is no longer the largest trading partner to the United States, and its share of U.S. imports has fallen by almost 10 percentage points in five years: from 22 percent in 2018 to 13 percent in the first half of 2023. The trade restrictions imposed since the onset of U.S.-China trade tensions in 2018 have effectively curbed Chinese imports of tariffed products.

China is also no longer a prominent destination for outward U.S. FDI, losing rank to emerging markets such as India, Mexico, and the United Arab Emirates in the number of announced FDI projects.

There is suggestive evidence that direct links between the United States and China are simply being replaced by indirect links. Countries that have gained the most in U.S. import shares, such as Mexico and Vietnam, have also gained more in China’s export shares. The same countries are also larger recipients of Chinese FDI.

Large electronics manufacturers have accelerated relocating production from China to Vietnam, given U.S. tariffs on Chinese goods. However, Vietnam sources most inputs from China, while most exports go to the United States.

Meanwhile, Mexico eclipsed China as the biggest exporter of goods to the United States in 2023. But anecdotal evidence suggests that some of the manufacturers opening plants in Mexico are Chinese companies, targeting the U.S. market.

In other words, instead of blunted U.S.-China trade, we could be seeing it rerouted through other countries. And that appears to be lengthening supply chains, reducing efficiency, and potentially bringing new fragilities.

Clearly, fragmentation is already a reality, as geopolitical alignments shape trade and investment flows, a process that will likely continue. Despite efforts by the two biggest economies to cut ties, it is not yet clear how effective they will be in a deeply integrated and connected global economy. But if fragmentation does deepen, what would be the economic cost? And how would those costs be transmitted?

Foreign Policy illustration

Trade is the main channel through which fragmentation could reshape the global economy. Imposing restrictions on trade would diminish the efficiency gains from specialization, limit economies of scale, and reduce competition.

The capacity of trade to incentivize within-industry reallocation and generate productivity gains would be stifled. Less trade would also imply less knowledge diffusion, a key benefit of integration, which could also be reduced by fragmentation of cross-border direct investment.

A useful example is Brexit. Because of the extensive interlinkages between Europe and the United Kingdom, Brexit is thought to have had a sizable effect on the U.K. economy.

Fragmentation of capital flows would limit capital accumulation—because of lower FDI—and affect the allocation of capital, asset prices, and the international payment system, posing macro-financial stability risks and potentially leading to a more volatile economy.

The estimates of the economic costs of fragmentation vary widely and are highly uncertain. But recent and ongoing work at the International Monetary Fund (IMF) suggests that these costs could be large and weigh disproportionately on developing countries.

If the global economy were to fragment into two blocs based on U.N. voting on the initial 2022 Ukraine resolution, and if trade between the two blocs were eliminated, estimated global losses would be about 2.5 percent of GDP. But depending on economies’ ability to adjust, the losses could reach as high as 7 percent of GDP.

As for FDI, fragmentation in a world divided into two blocs centered on the United States and China—with some countries remaining nonaligned—could result in long-term global losses of around 2 percent of GDP.

In an extreme scenario, even those who benefit from fragmentation in its mild forms could be left with a larger slice of a much smaller pie. In short, everyone could lose.

Fragmentation would also inhibit our efforts to address other global challenges that demand international cooperation. The breadth of these challenges—from climate change to artificial intelligence—is immense.

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Industrial policy and subsidies are nothing new and can be useful. But shutting off from the world will have consequences.

Recent IMF analysis shows that fragmentation of trade in minerals critical for the green transition—such as copper, nickel, cobalt, and lithium—would make the energy transition more costly. Because these minerals are geographically concentrated and not easily substituted, disrupting their trade would lead to sharp swings in their prices, suppressing investment in renewables and electric vehicle production.

So, what can policymakers do to prevent the worst-case economic scenario? Three principles can help.

First, countries can seek a multilateral approach at the very least for areas of common interest. For example, a green corridor agreement could guarantee the international flow of minerals critical for the clean energy transition.

Similar agreements for essential food commodities and medical supplies could ensure minimum cross-border flows in an increasingly shock-prone world. Such agreements would safeguard the global goals of averting climate change devastation, food insecurity, and pandemic-related humanitarian disaster.

These are not lofty policy goals but are grounded in ongoing work. Take the last World Trade Organization (WTO) Ministerial Conference, where members agreed to ease intellectual property protections on COVID-19 vaccines and established a food security work program.

Second, if countries deem some reconfiguration of trade and FDI flows necessary, a nondiscriminatory, plurilateral approach can help them deepen integration, diversify, and build resilience.

Plurilateral agreements consistent with the WTO—such as regional trade agreements and joint statement initiatives—are clearly second best to multilateral agreements but could offer several benefits, such as economies of scale, greater market access, and diversified suppliers. By updating the rules to better reflect a changing global economy and allowing new partners to join when they are willing and able to commit to the standards, such agreements can help countries make progress even when multilateral cooperation is difficult. For example, 90 countries representing more than 90 percent of global trade are working together toward common digital trade rules . And 67 members came together around a WTO plurilateral agreement on domestic regulation of services that, when enacted, is expected to reduce trade costs.

Policymakers should be judicious when considering risks to resilience, targeting only a narrow set of products and technologies that warrant intervention on economic security grounds. Before deciding to bring production home, they must carefully consider whether there is truly a lack of suppliers from less risky regions and make an objective assessment of the social and economic costs of supply disruptions. This is especially the case for widely used technologies such as semiconductors.

Third, countries can restrict unilateral policy actions—such as industrial policies—to addressing externalities and market distortions. And make them time-bound. Policymakers should limit the goal of such measures to correcting market failures while preserving market forces where they can allocate resources most efficiently.

It is critical to carefully evaluate industrial policies, in terms of both their effectiveness in achieving stated outcomes and the associated economic costs, including cross-border spillovers.

Domestically, industrial policies may be hard to limit or roll back given their concentrated benefits and diffused costs.

Internationally, such policies may lead to retaliation, which would deepen fragmentation. According to recent IMF estimates, if China introduces a subsidy, the likelihood that the European Union imposes a trade-restricting measure within 12 months in response is 90 percent.

An intergovernmental dialogue—or a consultation framework—on industrial policies could help improve data and information sharing and identify the impact of policies, including their unintended consequences across borders. Greater transparency can allow for better analysis and understanding and, in turn, reduce negative spillovers. Over time, steady lines of communication could help develop international rules and norms on the appropriate use and design of industrial polices, assuaging trade tensions and creating the predictability needed for a well-functioning trading system.

On each of these three principles, we can look for blueprints from the Cold War. Throughout that period, the United States and Soviet Union made several agreements to avoid nuclear catastrophe. Both superpowers subscribed to the doctrine of mutual assured destruction , knowing that an attack by one would ultimately lead to total annihilation.

If we descend into Cold War II , knowing the costs, we may not see mutual assured economic destruction. But we could see an annihilation of the gains from open trade.

Keeping open the lines of communication—as is being done by the United States, China, and the EU—can help prevent the worst outcomes from occurring. The nonaligned countries, which are mainly emerging and developing countries, can deploy their economic and diplomatic heft to keep the world integrated, including through their interventions at G-20 meetings.

Of course, economic integration has not benefited everyone; acknowledging this is critical to understanding additional motivations behind global inward shifts, and domestic policies must adjust to broaden their benefits. But it has helped billions of people become wealthier, healthier, and better educated—since the end of the Cold War, the size of the global economy has roughly tripled, and nearly 1.5 billion people have been lifted out of extreme poverty. It is in everyone’s interest to advocate strongly for a multilateral rules-based trading system and the institutions that support it. It’s the best chance for a world where people can expect a brighter, more prosperous future.

This article is adapted from a speech Gita Gopinath gave to the 20th World Congress of the International Economic Association in December 2023.

Gita Gopinath is the first deputy managing director of the International Monetary Fund. Twitter:  @GitaGopinath

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Penn Global Seminars announces offerings for next academic year, adds several new courses

10-01-19-pennglobal-passport-eric-zeng

Penn Abroad announced 18 Penn Global Seminar courses for the 2024-25 school year, adding new offerings that will travel to countries including Brazil, Malawi, and Bulgaria. 

The new courses for next year span five continents and a wide variety of disciplines, from engineering to foreign policy. These include "Global Jewish Communities," "Bicycles: The Mechanical Advantage," "Science Accessibility in India," "European Foreign and Security Policy in Times of Crisis," "Perspectives in Afro-Luso-Brazilian Culture," "Global Aging — Challenges and Opportunities," "Policy Task Force on U.S.-China Relations," "Global Business Communication for Impact," and "Before Netflix: The Past and Present of Latin American Television."

Penn Global Seminars are a general classification of courses that contain a travel component. Associate Director of Penn Abroad Arielle Schweber said that the travel portion aims to deepen students' understanding of topics discussed in the classroom. 

“One of PGS’ goals is to travel to destinations that we are typically underrepresented in study abroad,” Schweber said. “This year, we were thrilled to receive proposals from faculty to travel to new locations.”

 SNF Paideia Program hosts event honoring founding faculty director Michael Delli Carpini

Perry World House names inaugural cohort of non-resident senior advisors

One new offering, “Bicycles: The Mechanical Advantage," is the first course in collaboration with Penn's School of Engineering and Applied Science that also has an Academically Based Community Service designation through the Netter Center for Community Partnerships. Students will learn about bicycle design and develop practical skills, culminating in a trip to the Netherlands over spring break. 

Another new course is “Global Jewish Communities,” taught by Edmund J. and Louise W. Kahn Endowed Term Professor in the Humanities Peter Decherney and senior lecturer in Critical Writing Sara Byala. Students will learn about the history of the Abayudaya — a Jewish community in Uganda — and spend time engaging with community members over winter break. 

“In Uganda, we will partner with members of the Abayudaya communities to amplify their stories through short video profiles,” Decherney said. “The videos will also be easily shareable through social media, empowering the Abayudaya and others to disseminate the videos that they make with us.”

Another new course offering is “Policy Task Force on U.S.-China Relations'' taught by Penn Project on the Future of U.S.-China Relations Director Neysun Mahboubi. Students will develop policy recommendations for United States-China relations in coordination with students at Tsinghua University in Beijing.

According to Mahboubi, the course’s goal is to contribute to discussions of “U.S.-China [policy] in meaningful and substantive ways” by writing “policy papers that are workshopped on campus and then presented in the fall to policymakers in DC.” 

Other destinations for PGS courses next year include the United Kingdom, Mexico, Egypt, Italy, and India. Financial aid can be applied to the flat fee of $950 for the travel component. Applications for the fall 2024 offerings will close April 8.

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