Question

Assume that you are a US based MNC. Please tell me how you would assess and reduce the economic exposure for a company that the US MNC owns in Myanmar.

Answer 1

A country of Myanmar and its economy is largely influenced by the military leadership in the country and it does not create a market based economic system, preferred by many MNCs in the country. In this regard, the US MNC will try to reduce the economic exposure in different ways. The first way is to build strategic alliances with the local Myanmar based companies. It can be a joint venture so that US company will get local expertise and support of the local firm to move in the market. It will increase the movement in the country without involving a higher level of investments. The second way is to bring goods that are manufactured in other neighboring countries such as China and India by the other sister branches and sell them in Myanmar. It will limit the risk as long as the economic conditions don't improve. The third way is to work on a franchise model where local players will be associated as franchises and they will work under the brand name of the US company though the investment will be brought by the local players. Here, US company will have less control, less exposure, but income will come to the US company.

So, these are the ways to reduce the economic exposure in the country of Myanmar.