Mexico, Indonesia, Pakistan and Turkey - the emerging markets to watch
Mexico, Indonesia, Pakistan and Turkey are in a favourable position to become the new generation of emerging economies to have significant impact on the global economy claims Grant Thornton International. Following on from the Grant Thornton International Business Report (IBR) in February 2007 into the impact of the BRIC economies (Brazil Russia, India and China) on the global market place the international accounting organisation has identified Mexico, Indonesia, Pakistan and Turkey as the front runners to inherit the BRIC mantel from the original four. These countries may match or even overtake some of the commonly identified BRIC economies (Brazil, Russia, India and China) which are expected to join the global economic powers.
Although these economies are unlikely to match India or China in strength, they certainly have the potential to rival Brazil and Russia in terms of economic strength.
Alex MacBeath, global leader of privately held business services for Grant Thornton International, said:
"Indonesia and Pakistan, with their large populations, have the potential to grow their labour-intensive exports and could capitalise on the process of low-cost production that mainland China has so successfully exploited. Mexico, as the 14th largest economy in the world, is benefiting from its close trading ties with the other North American Free Trade Agreement (NAFTA) countries and is well-placed to play a more significant role in the Americas. Turkey is expanding robustly and is on the path to making the transition to a modern industrial economy and is set to increase its influence in Western Europe and the Middle East."
According to Hector Perez from Salles, Sáinz-Grant Thornton in Mexico:
"The reason for such an outstanding performance from the Mexican economy during 2006 was the unprecedented macroeconomic stability, a steady Mexican peso and a low inflation rate of 4%.
"Mexico is an export-oriented economy, dominated by a mixture of industry and agriculture. It is the biggest exporter in Latin America (US$250.3 billion) and the 15th in the world, as well as the only member of the Organisation for Economic Co-operation and Development (OECD) in the region. Furthermore, Mexico received the highest figure of foreign direct investment headed to Latin America and is top of the list in terms of per capita GDP. It is one of the most open economies in Latin America and has signed 12 free trade agreements with 43 countries. There is no doubt that it will be one of the top emerging markets in coming years."
Hendra Winata from the Grant Thornton firm in Indonesia commented:
"The Indonesian economy continues to strengthen with the help of a vigorous policy reform agenda aimed at reviving investment and easing inflationary pressures. As a result the country's growth target of 6% looks very achievable.
"Indonesian commodities have also seen strong demand from both increased household consumption and externally from mainland China, India and the Eurozone. Although it is expected that Indonesia's economic recovery will remain on track, any global economic slowdown would be one of the main challenges for the country to resolve."
Aykut Halit from Arkan & Ergin Grant Thornton in Turkey commented: "Turkish economic growth rates over the past five years have averaged 7.5% with foreign trade averaging 26% a year. These rates are unprecedented and reflect the great potential of Turkey brought forward thanks, among other things, to continued political stability over the same period. Foreign direct investment has come in at record levels from Europe, North America and the Middle East as have many international banks. Turkey is also set to be boosted by becoming a full member of the European Union in the near future."
Ends
Notes to editors
Grant Thornton International started a major annual survey of the attitudes and expectations of small and medium-sized businesses in 1992 called the European Business Survey (EBS). In 2003 the research project was widened to an international perspective covering medium-sized businesses and renamed the International Business Owners Survey (IBOS).
In 2007, the survey's name was changed from IBOS to the International Business Report (IBR). The IBR survey draws upon 15 years of trend data for original EBS participants and 5 years for original IBOS countries. 15 year trend data is available for: France, Germany, Greece, Ireland, Italy, the Netherlands, Poland, Spain, Sweden, Turkey and the UK, while 5 year trend data is available for Australia, Canada, Hong Kong, India, Japan, Mexico, Singapore, South Africa and the US.
Grant Thornton International will donate US$5 to UNICEF for every completed IBR questionnaire. In 2007 this will result in a donation of over US$35,000.
The research was conducted by Experian Business Strategies Limited and Harris Interactive. All figures were correct at time of going to press. To find out more about IBR and to obtain details of IBR reports and results please visit www.internationalbusinessreport.com.
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