When instability in a country like Venezuela forces skilled professionals to flee, a multinational corporation can retain that talent by relocating them to offices in other countries, turning a local crisis into a global talent redistribution.
In places like Venezuela, a multinational's office becomes a sanctuary with reliable power and communications. The commute is a dangerous journey between secured corporate compounds and gated residential communities, highlighting the stark contrast with failing public infrastructure.
Resourceful Venezuelans tapped into private energy sources like small hydro plants to mine Bitcoin. This created a portable, non-governmental store of value they could carry on a digital wallet to flee the country and start a new life.
When entering challenging markets, large Western companies often operate in proximity. This creates a de facto ecosystem where participants share similar operational norms and contractual expectations, reducing friction and risk for all involved.
In Venezuela's crisis, the bolívar devalued so severely that its calorific value when burned for fuel exceeded its purchasing power. This illustrates the complete collapse of a currency's function as a store of value and medium of exchange.
In unstable environments, adherence to Western standards for food safety and anti-bribery isn't a burden but a key differentiator. It attracts other multinationals as customers who value reliability and predictability, knowing contracts will be honored without illicit payments.
Before committing large sums to a volatile market, companies should launch a small business like a portable feed mill. This allows them to learn the real operational challenges and unwritten rules with minimal financial exposure before scaling.
When local currency collapses, companies in places like Venezuela must shift focus from core operations to creatively exporting anything possible (like salt or pallets) just to secure hard currency for essential imports like spare parts.
In response to the Russian invasion, Ukrainian farmers pivoted from complex, expensive crops like corn and sunflowers to basics like wheat and barley. This strategy minimizes financial risk and labor needs amidst human capital shortages and infrastructure damage.