Factors influencing Petroliam Nasional Berhad into overseas ventures / Farahin Md Farick

Over the last twenty years, the economy of the world has been progressively transformed. According to Bartlett & Ghosghal, the changing market conditions, intensified global competition and increasingly shorter product life cycle mean that firms have to re-examine the traditional method and strategies for doing business. Increasing uncertainty, discontinuity and complexity characterized the business environment nowadays. Malaysia’s national oil company, Petroliam Nasional Berhad (PETRONAS) will need to identify and venture upon niche gas and oil for specific countries due to the increasing globalization that has increased the intensity of competitiveness facing the business to generate more intensified competition for investment opportunities worldwide not only for Malaysia but for other countries too (Kamaluddin, 2008). Among any other national oil companies, PETRONAS must build and focus strategic integration with foreign affiliates, including joint ventures, acquisitions or even mergers on its ventures to overseas countries in terms of high value added and also high technology industrial activities and related services. These will eventually help in to contribute a wider platform for PETRONAS to generate greater linkages as well as to integrate global or even regional networks of production and market. International joint ventures represent an effective way of competing globally in coping with the increasing competitive and technological challenges of the globalization of world economies (Heenan & Perlmutter, 1979).