Economic and Political Reforms in Myanmar and China: Business Strategy

This report analyzes the economic and political reforms in Myanmar and the growth of the Chinese market, assessing the impact on international business strategies. The report begins by examining Myanmar's economic stagnation under military rule and the subsequent reforms initiated by Thein Sein's government, including privatization and currency adjustments. It then explores the liberalization and political transition, highlighting the role of foreign direct investment and the potential for future economic growth, as well as the risks associated with technological limitations. The second part of the report focuses on China's economic growth, analyzing its consumption rate and the challenges faced by foreign companies, such as cultural differences and piracy. The case of Best Buy in China is discussed, alongside the influence of Alibaba's Tmall and Taobao on consumer behavior. The report concludes by emphasizing the importance of understanding the cultural context and the evolving consumer landscape for businesses operating in both Myanmar and China.

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Political and economic reform in Myanmar Answer to the question 1
The case clearly indicated the economic reforms that were witnessed by Myanmar since
the year 2010. The nation was ruled formerly ruled by military dictatorship since the year 1960s
which critically stagnated the economic capabilities of the same. The economic stagnation of the
nation under the reign of military dictatorship in 2012 is evident through the GDP per capita
which was $1,400, despite having a wealth of natural resources like timber, minerals, oil and gas
(Rieffel, 2012). On the other hand, the GDP of Thailand was $10,000, being Myanmar’s
neighbor country greatly portrayed the stagnation in the economy (Rieffel, 2012). On the other
hand, the lack of inward FDIs in the nation also affected the growth of businesses. The lack of
rail links and roads between Myanmar and the neighboring countries like China, India and
Thailand also affected the rate of growth of the nation. It has been researched through the report
that more than 60 million people of the nation are involved in agriculture with minimized scope
of business improvements affected the economic growth of Myanmar resulting to stagnation.
 Answer to question 2
After the 2010 elections the government led by Thein Sein aimed at removing restrictions
from the press and allowed opposition parties in contesting by-elections. The political reforms in
the nation was initiated by the government with the objective of bringing forth changes in the
military dictatorship structure, which prevented economic growth. On the other hand, the
economic reforms that were undertaken by Sein through the privatization of state owned
enterprises encouraged the business developments. It has been noted that under the reign of Sein
the government started reducing their role in wider range of energy, forestry, healthcare and
telecommunication sectors. On the other hand, the government abandoned fixed rates for

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Myanmar’s currency with the objective of encouraging the fall of the value of Kyat. The falling
value of Kyat mandated the nation to maximize exports. The maximization of the exports and
inward FDIs would enable Myanmar in reforming the economic structure of the same. The
government initiated the political and economic reforms with the objective of enhancing the rate
of operations while operating in the different markets. The government initiated the reforms
with the objective of initiating the growth of privatized companies in the nation which will
contribute to the economic growth of the nation. The major purpose of political and economic
reforms made by the government was reflected on their concern of bringing forth modifications
in the economic structure of the nation. Therefore, the government aimed at bringing forth
significant changes in the organizational operations with the objective of encouraging the growth
of organizations.
 Answer to question 3
Myanmar’s economic reform might be noted as liberalization and stable political transition.
The liberal attitude of the government towards the inward FDIs and privatized the different
departments with the objective of improving the economic state of the nation. The government is
trying to encourage the growth of the foreign companies to maximize investments in the different
sectors that are prevalent in Myanmar for improved growth options (Chow & Easley, 2016). On
the other hand, the privatization of the different departments would enable the government in
maximizing the engagement of the entrepreneurs through reduction of stringent policies and
tariffs. The maximized involvement of the entrepreneurs and the growth of trade and commerce
in the nation would empower the GDP and economic growth of Myanmar (Findlay, Park &
Verbiest, 2016). The growth of FDIs would enable the nation in developing infrastructural and
technological facilities contributing to the improvements in the rate of GDP. Therefore, the

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different changes in the government’s approach would enable the growth of business and
commerce in Myanmar.
 Answer to question 4
The further improvements in the economy would be based on collaboration with the other
nations with the objective of ensuring technological growth. In this relation, the nation might
face significant impediments relating to the lack of bilateral trade agreements which might affect
the rate of operations of the venture while operating in the different markets. On the other hand,
the lack of technologies might again affect the growth of inward FDIs as it might increase their
cost of operations in Myanmar (Findlay, Park & Verbiest, 2016). The minimized rate of inward
FDIs would restrict the GDP and industrial growth of the nation.
 Answer to question 5
In November 2015, as the opposition party under the rule of Anug San Suu Kyi won by 81%
of the seats of the parliament in Myanmar which would bring forth liberalization through the
economic and political reforms (Farrelly & Win, 2016). The economic reforms that are being
initiated by the government would enable Myanmar as an emerging nation with improved GDP.
On the other hand, the economic reforms would enable the nation in enhancing the growth of
industrialization and commerce. However, the significant amount of risks that might be faced by
the nation are related to the lack of efficient technologies which might affect the rate of growth
of the industries. Moreover, the nation might require to hire techs from the foreign countries
which might again affect their economic conditions.
Will China continue to be a growth marketplace? Answer to question 1

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The unprecedented growth of China will continue till 2050 as per the expected growth of
the consumption rate. The enhanced rate of consumption would enable the nation in improving
the rate of GDP growth. The nation’s GDP is estimated to grow by 5.5% till 2020 due to the
enhanced consumption rate of the consumers. On the other hand, many foreign companies
invested for their unprecedented growth in the economy as China provided with facilities such as
low cost production (Liu, Oosterveer & Spaargaren, 2016). The growth of the FDIs in the
nation was however interrupted by the cultural differences between the Chinese markets and the
work culture of the companies. However, the nation developed an increased GDP through
encouraging the consumption related habits of the customers (Lardy, 2016). The better
identification of the needs of the customers have greatly contributed to the operations of the
venture which re-established their position in the Chinese markets. However, there are different
issues in the Chinese markets which affected the rate of growth of the foreign companies (Zhu
& Sarkis, 2016). It has been noted through the case that the e-Bay and Best Buy encountered
significant issues while expanding their operations in the Chinese markets due to the cultural
differences. The cultural differences and the consumption related information that is utilized by
the Chinese organizations are flawed through the lack of understating of the demand or
expectations of the other customers. Therefore, the cultural gap would act as a major
impediment for the nation towards its growth till 2050. However, the diverse range of offerings
that are made by the Chinese companies and the growing trade and commerce in China would
surely contribute to the strategic position of the nation. Therefore, I believe that China would
maintain their strong economic position in the coming years.
 Answer to question 2

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The situation that was reflected by Best Buy’s case in China was specifically based on
the reluctance of the Chinese to pay for overly priced commodities that are developed by the
organization (Lardy, 2016). On the other hand, from the Best Buy case, it might be stated that the
presence of piracy and duplicity in the Chinese markets have prevented the customers to select
branded high priced products over substitutes. Lastly, the Chinese population dislikes shopping
from huge mega stores. Therefore, the cultural issues affected the growth of Best Buy in the
Chinese markets. However, if China will go from 17 million to 200 million middle and upper
income population, there will be significant changes in the buying behaviors (Lardy, 2016). The
improvements in the lifestyle of the people would drive them to westernized cultural backdrops.
The changing lifestyle of the Chinese people would change the situation that is being reflected
through the case of Best Buy. The changes in the design of the consumption habits and cultural
affluences are specifically based on the lifestyle of the people. The increased rate of middle and
upper income population would boost their buying behavior which will thereby increase the rate
of sales of the overpriced commodities while overlooking the substitutes that are generally
available in the markets. On the other hand, the increased buying power of the customers will
also bring forth changes in the cultural affinities which will result to sales from huge mega
stores.
 Answer to question 3
The ownership of Alibaba over Tmall and Taobao would enable customer
communication with the direct sellers which might increase the influence of western based
online shopping culture. The enhanced rate of communication between the sellers and the buyers
would encourage the Chinese consumers in maximizing their buying habits from different online
platforms. Again, the enhanced buying experience through maximized rate of communication

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would enable the Chinese buyers in developing online buying habits influenced of western based
online shopping culture. Therefore, the development of Tmall and Taobao and its ownership
under Alibaba would certainly influence the buying behavior of the Chinese customers.

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References
Chow, J. T., & Easley, L. E. (2016). Persuading pariahs: Myanmar's strategic decision to pursue
reform and opening. Pacific Affairs, 89(3), 521-542.
Farrelly, N., & Win, C. (2016). Inside Myanmar's Turbulent Transformation. Asia & the Pacific
Policy Studies, 3(1), 38-47.
Findlay, R., Park, C. Y., & Verbiest, J. P. A. (2016). Myanmar: building economic
foundations. Asian‐Pacific Economic Literature, 30(1), 42-64.
Lardy, N. R. (2016). China: Toward a consumption-driven growth path. In Seeking Changes:
The Economic Development in Contemporary China (pp. 85-111).
Liu, W., Oosterveer, P., & Spaargaren, G. (2016). Promoting sustainable consumption in China:
a conceptual framework and research review. Journal of Cleaner Production, 134, 13-21.
Rieffel, L. (2012). Myanmar’s Economy Confronts Tough Policy Challenges. Brookings
Institution. Washington DC. http://www. eastasiaforum. org/2012/07/31/myanmar-s-
economy-confronts-tough-policychallenges.
Zhu, Q., & Sarkis, J. (2016). Green marketing and consumerism as social change in China:
Analyzing the literature. International Journal of Production Economics, 181, 289-302.

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