Venezuela under Hugo Chavez and Beyond & Political and Economic Reform in Myanmar

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International Business
Question 1. Venezuela
Type of economic and political system put in place in Venezuela.
Under Chavez, the economy fell, and unemployment and the rate of poverty increased to higher levels. World bank declared Venezuela to be the most controlled economies in the world in 2003 due to the control of businesses by the state which provided the public officials with the chance to extort money from entrepreneurs (611). The consequence was that the communism economy failed and was controlled by a few individuals while most people suffered. The political system provided the president with an excess power to rule by decree, and this appeared to be like a dictatorial regime.
Impacts of unilateral changes to foreign oil companies’ contracts on future investment.
The unilateral changes to contracts held by foreign companies by Chavez will make the foreign investors fear to invest in Venezuela. This has the effect of reducing beneficial competition with the local companies hence the probability of low investment in the oil company in the future.
Effect of corruption on future growth rates
The high level of corruption will prevent the resources from being distributed equally, and the growth rate in the future will likely be uneven.
Oil prices effect on the economy and government finances.
The economy reduced by 4% in 2014 after the sharp decline in oil prices and inflation increased to about 65 percent. This decreased the government revenues, and prosperity and IMF projected the drop to be the worst decline in the world (611).

The value of Venezuelan currency fell significantly, and unemployment and poverty rate increased tremendously.
The impact of foreign multinationals exiting Venezuela and what needs to be done to change the trend.
The exit of foreign multinationals from Venezuela demoralized potential investors from undertaking their operations in the state. As a result, the money that Hugo Chavez expected to generate from foreign royalties couldn’t be made a reality. The way to change this trend would be to increase the stakes held by external multinationals, reduce the fees they pay and give an equal position to every company, regardless of their nationality.
What needs to be done to reverse the economic collapse in 2016.

The economy of Venezuela almost collapsed in 2016 due to reasons caused by political decisions. The country needs a change in political leadership which seems to be a full-fledged dictatorship to change this economic decline. Having a new president who takes into account the existence of legislative decisions and an independent judiciary system that would help curb corruption would help save the economy.
Question 2. Myanmar

Reason for the non-growing economy of Myanmar until 2010

Myanmar experienced poor leadership from the military dictatorship that siphoned off economic profits for their benefit after controlling the press, blocking the formation of opposition parties and condemning political dissent. These events led to Myanmar’s economic stagnation from the 1960s up to 2010 when Thein Sein won elections.
What motivated the government to take economic and political reforms from 2010 onwards

The imposed economic sanctions by the European Union and America adversely affected the Military junta. The economy was poor despite having several natural resources. The regime also faced challenges in exporting their goods due to the official fixed exchange rate for Myanmar currency. The government was motivated to start undertaking political and economic reforms (612).
The nature of reforms. What the government is trying to do and the expected result.
The economic reforms have long-term benefits since it would take time to get back the economy on its feet and to get a stable currency that would do favorably well in exports market. The government is merely trying to create a conducive environment for foreign investment, and this is likely to bring development soon since companies like IBM have already started showing interest in investing in Myanmar.
Potential implements towards further improvements
The obstacle towards further improvements in Myanmar may be due to the ownership of most of the state resources by the military. The military may still want to take control of the government when they feel that the reforms threaten their illegally acquired resources.
Effect of 2015 General election on economic growth and the risks involved
The 2015 elections win will probably allow for more economic reforms and growth by the government since it was overwhelmingly voted in by the people. This insinuates that the government has the interest of the people at heart. The risk here is that the government may fail to deliver since it has a majority of seats in parliament that is unlikely to be overlooked by the opposition.

Work Cited
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