Bric will continue to dominate decisions

Oct 29 2008 by Brendan Murphy for The Journal

THE big four emerging markets consisting of Brazil, Russia, India, and China (Bric) have been central to many international business expansion plans for a number of years.

In a recently published survey, commissioned by UKTI, business executives from around the world continue to invest their faith, judgment and hard earned cash in Bric alongside carefully selected targeted emerging markets.

The Tomorrow’s Market report highlights in great detail the strategic thinking of 561 high-level global executives, including 200 from emerging markets, about their current corporate activity and future intentions.

Almost half (47%) surveyed were SMEs, with annual global revenues below US$500m and one fifth had global annual revenues of more than US$10bn.

The surveyed executives were employed in a wide range of business functions across 19 sectors and 58% were C-suite or board members.

The report clearly demonstrates that the Bric markets will continue to dominate future investment decisions with increasing amounts being redirected to the Bric’s outlying regions.

Nearly two-thirds of executives (63%) believe that the economic strength of emerging markets will help to offset the impact of a downturn in Europe and North America. As a result, emerging market revenues which currently account for, on average, 29% total revenues of those surveyed, are expected to rise to 38% of total revenues.

In addition, over one third of those surveyed (34%) say their company will enter three or more emerging markets over the next five years as opposed to the more developed markets.

Survey results also suggest that within the next 10 years inward investment in China will have spread way beyond the main cities of Beijing and Shanghai, most notably towards the Yangtze River Delta, the north east and western interior.

A similar pattern is emerging in India, with companies looking to expand from Delhi and Mumbai to areas such as Gujarat and Ahmadabad.

For some business sectors the main focus of interest outside the Bric countries are Vietnam, Mexico, UAE and selected high growth markets in South East Asia.

In the North East, many of our regional businesses are already well established in some Bric countries and many more are just beginning to realise the potential and are actively pursuing opportunities.

For businesses interested in finding out the latest information and market intelligence throughout the Brics and other regions please call the Regional International Trade Office Hotline on 0845 0505054.

Brendan Murphy is international trade director at the North East Chamber of Commerce