Question

What are the emerging markets? Give examples of emerging markets.

What are new global challengers? What advantages do they typically possess?

Do new global challengers pose any threat to firms from advanced economies? Explain.

What makes emerging markets attractive for international business?

What can businesses do to support the development of poor countries such as Africa?

Answer 1

1. Emerging markets are the new markets in the developing countries which are shifting from their traditional economic structures based on activities of primary sector to the advanced economies based on knowledge based secondary and tertairy sectors and exhibiting the characterstics of developed economies. Some examples are India, China, Brazil, Argentina, Turkey, Malaysia etc.

2. Global challengers are the global companies of the emerging markets that have maintained their decent growth rate despite economic downturns and challenging environment. These companies have an advantage of their global presence and access to the world's leading markets besides having cost effective leadership back home.

3. Many of the Global challengers have achieved or are trying to achieve the global leadership position through strategic alliances, partnerships, mergers and acquisitions with the local partners, building global brands through creating a global culture, inducting best in the market talent to drive the growth. These organisations pose strong challenge to the established global players to be more cost effective, lean and performance driven to remain competitive in their fields.

4. Rapidly growing productive population of the emerging markets, transfromation in the economic structure, cost effective operations, high disposable incomes and spending capacities, global connectivity and rising urban cosmopolitan culture have made the emerging markets a prime targets for international businesses which see a new breed of consumers that are well connected, informed and knowledgeable, appreciate global products and have money to spend.

5. Large Businesses can set up industries in countries like Africa and invest in the community development programs through helping the locals to develop homegrown small businesses with the help of vast natural resources they have. The educated and trained manpower developed as a result of these initiatives may contribute to the global economy through directly or indirectly working for these businesses as knowledge workers or as suppliers of raw materials and intermediate products. When mature, these economies may also serve as a market.