While Brazil, Russia, India and China (BRIC) remain prominent names on the emerging markets list, a new set of countries whose economies are poised for take-off and an e-commerce boom have been added to the lineup.
A new set of markets called the MINT (Mexico, Indonesia, Nigeria, and Turkey) and CIVETS (Colombia, Indonesia, Vietnam, Egypt, Turkey, and South Africa) nations are being forecast by the World Bank and Goldman Sachs to make the list of the top 20 contributors to global GDP by 2050.
Participants at a virtual roundtable hosted by supply chain service provider Federal Express (FedEx) said these markets are “heralding the next era of global opportunity.”
Businesses of all sizes are contributing to the expansion of these new economies, and the World Bank’s Ease of Doing Business index ranks these new markets highly for business.
Vietnam’s growth, for instance, is being supported by exports and foreign investment, with the country’s exports-to-GDP ratio projected to increase to 77.7 percent in 2014, up from 75 percent in 2012.
The populations of these markets are also growing rapidly, expanding at over twice the average rate of the BRIC and at nearly three times the rate of the G7 economies. Along with this, consumer spending from Indonesia and Mexico is projected to outstrip spending from most G7 countries by 2030.
Connectivity and e-commerce are critical catalysts for economic growth in the new emerging markets, noted the analysts.
They predicted that emerging markets will account for 70 percent of mobile connection and subscriber growth between 2013 and 2017.
“E-commerce sales globally are projected to reach US$1 trillion by 2016, where emerging economies are key growth markets. While China is the largest e-commerce market within APAC, Indonesia is the fastest growing in B2C sales,” the participants added.
“Rich with possibilities, these young, vibrant new economies are just starting to flex their muscles, but by 2050 many are projected to make up the top 20 contributors to global GDP,” said Raj Subramaniam, executive vice president for global strategy, marketing, and communications at FedEx Services.
He added that Mexico and Colombia typify the strength that all the MINT and CIVETS countries share: proximity to a huge market full of potential buyers, abundant natural resources and commodities to sell, as well as a young and increasingly well-educated population that is eager to work and has money to spend. The two economies are also better connected—both physically and virtually—to the world market.
But the Internet cannot stand alone, Subramaniam continued. For these new markets, the right physical infrastructure must be in place to support connectivity among the businesses in that market to consumers all over the world.
“The geographic proximity of these markets to larger, more established economies creates a natural opportunity for commerce. It is estimated emerging economies will account for 40%-50% of infrastructure spending over the next 18 years,” Subramaniam said. “The right investments will yield bright futures for these economies, and the role they can play in the global marketplace.”
Photo: Jerome Bon
