Oil in Venezuela Research Paper Example | Topics and Well Written Essays - 2750 words

Oil in Venezuela - Research Paper Example Despite the knowledge of oil for ages the, the first oil wells were not drilled up until 1910s. According to McBeth (2005) asserts that when Juan .V. Gomez took the reigns of power in 1908, he granted several concessions to explore, produce and refine oil. Most of these concessions were actually given to his closest allies, and they in turn passed them over to foreign oil companies that could develop them. From 1914 to 1917, more oil fields were discovered across the nation. By the end of 1918, petroleum had appeared for the very first time in Venezuelan export’s statistics at 21,194 metric tonnes (Martinez, 1979). After 20 years, Venezuela became the largest oil exporter in the whole world and second largest oil producer after the United States of America. This led to an influx of foreign investors. By 1929, with the nation being the second largest oil producer in the world. Currently, Venezuela is the fifth largest oil exporting nation in the world, with the largest reserves of both conventional oil in the western hemisphere and non-conventional oil. This fact is very immense importance to the understanding of Venezuela because it has shaped the country’s political, economical, cultural, and historical scenes (Wilpart, 2003). Venezuela has 77.2 billion barrels of proven conventional oil reserves, the largest in any state in the Western Hemisphere. Approximately 267 barr els of this might be producible at current prices utilising the current technology. Venezuela was the first country to make a move towards the establishment of the Oil Producing and Exporting Countries (OPEC). It approached Saudi Arabia, Kuwait, Iran, Gabon, and Libya in 1949, but OPEC was not set up until 1960. This was when the United States forced import quotas on the Persian and Venezuelan Gulf oil so as to support the Canadian and Mexican oil industries (Martinez, 1979). In 1973, OPEC wielded its first power with the 1973 oil embargo against Western Europe and the United States. Discussion Economy In Venezuela, there was dramatic development of the oil industry, and the oil sector commenced to dominate all other economic sectors in the country. On the other hand, agricultural production began to decline slowly. Agriculture accounted for about one third of the economic production in 1920. According to Yergin (1999) argues that this sudden change increases attention on oil and ne glecting the agricultural sector causing the Venezuelan economy to suffer from a phenomenon referred by economists as the â€Å"Dutch disease†. The occurrence of this disease is manifested when a commodity brings substantial increase in income in one sector, resulting in strengthening of the currency which in turn harms exports of the other manufacturing sectors. This increased sectoral income has caused a distorted growth in services and other non-tradables, which can not be imported whilst discouraging the production of tradables, which are actually imported. The reason for this disparity is that, greater income dramatically raises the demand for imports because the domestic market production can not meet the production quickly enough. This raises the demand for services of which the domestic market has to supply because the services can not be easily imported as the tradables. When one looks at the extent to which there has been increased oil production and income, which w as followed by a corresponding steady decrease in agricultural production, one can clearly observe the symptoms of Dutch disease in the Venezuelan economy. This resulted in a delay in industrialization. The other Dutch disease symptoms are evident in the constant

Strategy of Zara Essay Example | Topics and Well Written Essays - 3250 words

Strategy of Zara - Essay Example According to the paper strong financial backing is provided to Zara by the parent firm Inditex. The parent firm has touched revenue of â‚ ¬13.79 billion. The retail chain however holds various trademarks. While talking about trademarks it needs to be mentioned that very recently Zara had defeated Louboutin in France in battle related to the mark of red soles. This helped the high street retailer to boost sales of the shoes.This essay discusses that the exclusive logos and brands are the resources that have helped the company to achieve product differentiation. The communication system also integrates the management, designers, suppliers, manufacturers and customers. Zara also has a very unique inventory model as the company does not hold a large amount of stock at eh stores. The ability of Zara to adapt the rapidly changing trends of the fast fashion industry along with rapid rate of inventory turnover installs a sense of freshness and exclusiveness in the brand. Zara operates thr ough a flat organizational structure and self driven leadership model. The founders of Zara Ortega and Castellano believed that in order to be successful Zara has to respond quickly to the market trends and this only possible if the company has a decentralized decision-making model.  This is why the store managers of the company hold the power to select inventory for respective stores without consulting the head quarters. The main philosophy behind such organizational policy is to save time to support the JIT delivery model of Zara.