Spain's Guitar Industry Survives Despite Economic Crunch

January 2, 2012

Unlocking Word Meanings
Read the following words/expressions found in today’s article.

1.  struggle (v.) [struhg-uhl]  –  to progress with difficulty
Example: He was struggling with the new projects in his new job.

2.  reform (n.) [ree-fawrm] –  a change for the better or improvement
Example: Economic reforms can be done through creation of new laws.

3. crunch (n.) [kruhnch] –  a period of financial difficulty characterized by tight money and unavailability of credit
Example: People continue to shop for the holidays despite this year’s financial crunch.

4. overhaul (v.)  [oh-ver-hawloh-ver-hawl] – to carefully examine something in order to repair or rebuild it
Example: I decided to buy another computer instead of overhauling the old one.

5. joint venture (n.)  [joint ven-cher] – a partnership formed often to share risk or expertise
Example: Rich Mine Corporation is one of our company’s joint venture partners in the mining industry.

Read the text below.

As Spain’s economy continues to struggle, business owners are hopeful that the country’s new conservative government will provide better business environment.

Manuel Rodriguez, whose company manufactures Spanish classical guitars, is positive that the newly elected leader, Mariano Rajoy, would implement economic reforms which he promised the public during the campaign period.

The century-old guitar manufacturing company, Guitarras Manuel Rodriguez and Sons has survived the recent economic crunch while some competitors closed down. The business kept its production of quality guitars in Spain, but now with fewer workers. From sixty employees in the previous years, the number dropped off to 25 to save on labor expenses. The company has not hired a new full-time employee in the past six years.

He believes that Spain’s corporate regulations need to be overhauled to address the increasing unemployment rate in the country.

Currently, Rodriguez’s company has a joint venture in China to make more affordable guitars. This business partnership increased the company’s global sales by 10%. However, Rodriguez finds it quite difficult to compete with China in terms of production since people there work longer hours a week compared to those in Spain. Rodriguez said that employers must be provided with more freedom because the present labor laws are too strict.

Viewpoint Discussion
Enjoy a discussion with your tutor. 

Discussion A

·         What do you think the government should do to address unemployment?
·         What do you think companies can do to help address unemployment?

Discussion B

·         How do you think a company can cut its operational cost?
·         Is it necessary for a company to enter into a joint venture agreement or partnership with other companies? Why or why not?

January 2, 2012