Essay on Sustainable Emerging Market Economies

A handful of countries in Central Europe, Latin America, and Asia have experienced rapid economic growth throughout most of the past decade. Because this fast growth presents significant marketing opportunities, the countries are known as emerging markets. Ten countries generally recognized as emerging markets are China, India, Indonesia, South Korea, Brazil, Mexico, Argentina, South Africa, Poland, and Turkey. Despite contrasts between developed countries and emerging countries, experts predict that the emerging markets will be key players in global trade even as their track records on human rights, environmental protection, and other issues come under closer scrutiny by their trading partners.

Help With Essay on Sustaianble Emerging Market Economies
Help With Essay on Sustainable Emerging Market Economies

The main factors which influence economic growth and stability are FDI, export operations and industrial development. The article “The New Titans” states that: “newcomers boost real incomes in the rich world by supplying cheaper goods … by spurring productivity growth through increased competition” (The New Titans, 2006). Furthermore, it is argued that foreign direct investment (FDI) carried out by the MNC is possibly the single most contributing factor to the emerging economies. More recently, an increase in MNC activities with an estimate that 64,000 MNCs employ around 5 million people abroad, thus reiterating Lane’s (2000) view that the role of MNCs is significant and the FDI activities of MNCs are widely considered to be at the very centre of globalization tendencies. Thanks in part to the achievements of GATT, merchandise trade has grown at a faster rate than world production.

New economies not depend upon the back of USA because they develop their own production facilities. Also, union policies and free market zones protect emerging economies from downturns. According to the article The New Titans: “[emerging markets] start with much less capital per worker than developed economies, they have huge scope for boosting productivity by importing Western machinery and know-how” (The New Titans, 2006). Despite the difficult economic conditions in parts of Southeast Asia, Latin America, Africa, and Eastern Europe, many nations in these regions will evolve into attractive markets. One of marketing’s roles in developing countries is to focus resources on the task of creating and delivering products that are best suited to local needs and incomes. Appropriate marketing communications techniques can also be applied to accelerate acceptance of these products. Marketing can be the link that relates resources to opportunity and facilitates need satisfaction on the consumer’s terms. The USA economic slowdown does not have a great impact on emerging economies, because most of them depend upon their own markets. For instance, “China’s GDP growth has come mainly from domestic demand, which has been growing by an annual 9% in recent years” (The Alternative Engines, 2006).

A generally cited feature of the extremely mobile capital of the emerging global economy is its capability to circumvent the national level together. Even as the most marked expressions of this are found in those parts of the government selected (by the government itself) as ‘offshore’, this is also true of the rest of the national economy. The institutions of the national economy are completely circumvented. National economic policies have become geared toward helping internal competition between diverse industrial regions for investment. Competition is provoked by a combination of spatial and fiscal policies such as regional development agencies, ‘pre-competitive’ infra structural improvements, tax holidays and all way of financial ‘sweeteners’. As a result, transnational capital is seen to discuss directly with regional authorities—over the terms and conditions of their investment, including labor conditions, levels of service condition and infrastructure as much if not more than they do with national government. It is as though local and regional economies have ceased to be entrenched in a national economic space, but now compete directly with other related places in other governments in a global space. Even in the face of Asia’s economic downturn in the late 1990s, China demonstrated continued economic strength by achieving double-digit export growth. Chinese exports to the United States are expected to surge now that China has joined the World Trade Organization. In the Western Hemisphere, Mexico’s robust export growth since the mid-1990s shows the continuing impact of NAFTA. For the past several years, Mexico has been running a trade surplus with the United States.

Emerging markets contribute to the developed world supplying its with cheap labor and low cost goods. The influx of technology, particularly the computer revolution, creates startling juxtapositions of the old and the new in these countries. China has “a bigger global impact because of its vast size and its unusual openness to trade and investment with the rest of the world” (The Alternative Engine, 2006). Through the formation of the competition government, the homogeneity of the national economy though assumed in theory is cooperating in practice. The national private economy ceases to be believable as a homogenous unity and becomes a single but distinguished space. This has, certainly, always been the case, but the mobility of capital and the disintegration of the labor-intensive production systems. Such phenomenon as regional integration and cooperation between emerging markets helps them to sustain their own growth and internal infrastructure. Emerging markets ”have plenty of scope to ease fiscal policy to support domestic demand so as to offset some of the fall in exports” (The Alternative Engines, 2006). An intentional policy fostered by national governments is concerned to resolve balance of payments and fiscal problems. The emerging markets are strong enough to sustain growth and compete on the global scale. Most of them are independent from the USA economy and its downturns influenced by home demand, production and consumption patterns.
References
1. The Alternative Engine. The Economist. Oct 19, 2006. Available at: http://www.economist.com/business/PrinterFriendly.cfm?story_id=8049652
2. The New Titans. The Economist. Oct 19, 2006. Available at: http://www.economist.com/surveys/PrinterFriendly.cfm?story_id=7877959

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