Attractiveness and Limitation for FDI in Myanmar
Added on 2020-05-16
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Running head: MYANMAR0GLOBAL ANDINTERNATIONALCONTEXT
MYANMAR1Table of ContentsIntroduction:................................................................................................................................................1Part 1:..........................................................................................................................................................1Porter’s national diamond model:...........................................................................................................1Part 2:..........................................................................................................................................................1Modes of entry:.......................................................................................................................................1Attractiveness of FDI in Myanmar:...........................................................................................................1Limitations of FDI:....................................................................................................................................1Recommendations:..................................................................................................................................1Part 3:..........................................................................................................................................................2Management issues:................................................................................................................................2Conclusion:..................................................................................................................................................2References:..................................................................................................................................................2Appendix:.....................................................................................................................................................2
MYANMAR2Introduction:Globalisation is the concept that helps the companies to conduct their business activities acrossthe globe. Foreign direct investment is the mode that is used by the companies to enter theforeign land in order to set up their businesses. Myanmar is one of the countries which fallsunder the category of under-developed economy but has the potential to develop in future. As faras the mobile industry of the country is considered, it has been analysed that it is facing toughcompetition and Chinese players are fighting for the share. This report argues about mobilephone industry in Myanmar with the help of porter’s national diamond model. This discussionfollows with the explanation of FDI that s foreign direct investment in the country. It focuses onanalysing the attractiveness and limitation for FDI in Myanmar. The later part of the reportdiscuses about the management issues that the foreign company may face if enter this country. Part 1:Porter’s national diamond model:Michael porter is the one who has developed a model called Porter’s National Diamond model.The purpose of developing this model is to examine the competitive environment of any of theparticular industry. The analysis conducted by this tool helps the companies to frame theirstrategies as per the market conditions. Analysing the relative strength of the market helps thefirm to develop a competitive edge by implementing the relevant strategies (Gsma.com., 2018).There are four elements that are being discussed in order to analyse the market as per this modelAPPENDIX 1. These four factors involve:Firm strategy and rivalry: This is the element of the model that includes the discussion of thestrategies of the companies that allow them to be organised and managed. It also discusses aboutthe pressure that the organisations face in the industry due to competition. Factors input conditions: This is the element that discuss about the various resources. It has beenanalysed that the basic resources that are available in the country are natural resources and theadvanced resources are human resources, research capabilities.
MYANMAR3Related and supporting industry: this is the factor that discusses about the supporting and therelated industries that act as the suppliers and provide the materials for making innovations.These are the industries that provide inputs and participate in making up gradation of the process.Demand conditions: this is the element that deals with the demands of the products in the marketand the various market conditions that help the companies to develop competitive advantageover others. Porter’s National Diamond model application on mobile phone industry of Myanmar:Firm strategy and rivalry: Myanmar is the county that is enjoying a massive growth in the sectorof internet, mobile communication and usage of social media. This suggests that a new marketpotential is developing in the country for the companies that operates in these industries. Thecountry is observed to be experiencing a digital shift and this digital shift leads to change in thedemands of the customers in the market. It has been analysed that 50% of the growth has beenexperienced by Myanmar mobile phone industry (Fischer, 2016). Myanmar is considered as thefourth place to have net additions in the mobile phone subscribers. The country has trailed thenearby countries like India and China in this. The telecommunication industry of Myanmar hasexperienced and intense change. The survey has been conducted which suggests that 42.2% ofthe total mobile users in Myanmar are the customers of Huawei and rest other prefers to buysome other phones such as Oppo, Lenovo, Xiaomi, iPhone, sony etc. as per this analysis. It hasbeen identified that the users prefer to buy the phones that are of low prices and Chinese mobilesare getting success in the Myanmar market. The rivalry is amongst the Chinese players in thecountry. It is very important to understand the nature of the consumers and their choices to use the mobilephones. The figure suggests the options available in front of the consumer to use the smartphonesand the number of users that use mobile phones. APPENDIX 2Demand conditions: Myanmar is the country with great versatility. People have differentreferences to buy the products as per the gender and their ages. Chinese brands of the mobilephones are fighting for the market share because they are in demand. The communication sector
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