Changing Political & Economic Structure and associated Business Models in Emerging Economies
By: Amit Bhushan Date:21st April, 2014
The winds of change that were initiated as Arab Spring from Tunisia and led to political changes in MENA region now seem to be common place. A subtle though strong under-current is being seen in large democracies like Indonesia and India. In fact, most of the BRICS seem to facing these winds of change. Other emerging economies may also be bracing for politico-economic changes though may not be receiving the same kind of media focus that is reserved for larger economies where such changes may lead to significant impact in terms of business potential. More importantly, it is a signal that macro-level changes in the economies are likely to continue since such change has potential to alter the Trade (in commodity as well as in services) & Investment Flows, including they way the transactions are concluded in the economies. So each major step is likely to have significant ripple effect which is likely to take time to be absorbed in the economy as the economy itself continues to adjust.
As we continue to see this storm to blow over the major economies of India & Indonesia and leave its imprint over the formation of the new political structure, it will be wise to examine what essentially these winds of change seem to be seeking from political governance structure.
Changes in Politics is being sought in terms of putting together a governance structure that yields better participation of ordinary citizens in economic activity as well as putting together a more equitable wealth creation process. Improved and more transparent governance policies and processes are being sought with easier access to legal remedies without prejudice for the aggrieved.
Equipped with better information sources, people are increasingly being aware of the infirmities of the politico-business models and their impact which may be pre-judicial to their interest. This is cause of rift which is culminating to ‘change’. When a political change is realized by people, it may seem to be bereft of the follies of the old, however unless the new order brings forth structural changes to reinforce the ‘change’ which was sought by masses, it will soon tend to be seen as the ‘same old stuff’. Thus some of the governments seem to continue in turmoil as old structure seems in no mood to reform to a state that is desired by people (a challenge being to predict what people actually desire).
Change in Economy is being sought in terms of Rule based equitable access to public resources including mineral wealth, water/irrigation and other productivity sources like Education, Health care, Energy, Telecom etc. having better reach to target. The SMEs in the economy want to level the playing field which has been set by Corporate along with Multinational Corporations even as consumers seek ever more choices to good and services so that they meet their specific needs. Pressure groups of consumers and society are seeking better environment controls even as they want to protect jobs within the community.
Changes in Business models are being devised by some businesses whereby they can assess the macro-factors in domestic economy as well as at international level in better manner and devise policies and consumer/community/investor/government interfaces in manner to mitigate the changes. This is even as some businesses seek to profit from the change by devising plans so that they partner with new incumbents to some dazzling ‘change’ schemes and rake a mullah. It may be better to people to take a hard look at places which have already undergone some change and study how changes have affected Tunisia and Egypt i.e. a place which has started to grow economic activity while other continues in turmoil. This may help in understanding the internal and external factors that have brought in respective results in those countries and deduce important lessons on treading on the ‘change’ bandwagon with governance of the country even as politicking continues its course.
By: Amit Bhushan Date:21st April, 2014
The winds of change that were initiated as Arab Spring from Tunisia and led to political changes in MENA region now seem to be common place. A subtle though strong under-current is being seen in large democracies like Indonesia and India. In fact, most of the BRICS seem to facing these winds of change. Other emerging economies may also be bracing for politico-economic changes though may not be receiving the same kind of media focus that is reserved for larger economies where such changes may lead to significant impact in terms of business potential. More importantly, it is a signal that macro-level changes in the economies are likely to continue since such change has potential to alter the Trade (in commodity as well as in services) & Investment Flows, including they way the transactions are concluded in the economies. So each major step is likely to have significant ripple effect which is likely to take time to be absorbed in the economy as the economy itself continues to adjust.
As we continue to see this storm to blow over the major economies of India & Indonesia and leave its imprint over the formation of the new political structure, it will be wise to examine what essentially these winds of change seem to be seeking from political governance structure.
Changes in Politics is being sought in terms of putting together a governance structure that yields better participation of ordinary citizens in economic activity as well as putting together a more equitable wealth creation process. Improved and more transparent governance policies and processes are being sought with easier access to legal remedies without prejudice for the aggrieved.
Equipped with better information sources, people are increasingly being aware of the infirmities of the politico-business models and their impact which may be pre-judicial to their interest. This is cause of rift which is culminating to ‘change’. When a political change is realized by people, it may seem to be bereft of the follies of the old, however unless the new order brings forth structural changes to reinforce the ‘change’ which was sought by masses, it will soon tend to be seen as the ‘same old stuff’. Thus some of the governments seem to continue in turmoil as old structure seems in no mood to reform to a state that is desired by people (a challenge being to predict what people actually desire).
Change in Economy is being sought in terms of Rule based equitable access to public resources including mineral wealth, water/irrigation and other productivity sources like Education, Health care, Energy, Telecom etc. having better reach to target. The SMEs in the economy want to level the playing field which has been set by Corporate along with Multinational Corporations even as consumers seek ever more choices to good and services so that they meet their specific needs. Pressure groups of consumers and society are seeking better environment controls even as they want to protect jobs within the community.
Changes in Business models are being devised by some businesses whereby they can assess the macro-factors in domestic economy as well as at international level in better manner and devise policies and consumer/community/investor/government interfaces in manner to mitigate the changes. This is even as some businesses seek to profit from the change by devising plans so that they partner with new incumbents to some dazzling ‘change’ schemes and rake a mullah. It may be better to people to take a hard look at places which have already undergone some change and study how changes have affected Tunisia and Egypt i.e. a place which has started to grow economic activity while other continues in turmoil. This may help in understanding the internal and external factors that have brought in respective results in those countries and deduce important lessons on treading on the ‘change’ bandwagon with governance of the country even as politicking continues its course.