I believe in everything until it's disproved. So I believe in fairies,
the myths, dragons. It all exists, even if it's in your mind. Who's to
say that dreams and nightmares aren't as real as the here and now?― John Lennon
Why are we discussing about emerging markets? If we can have a suitable answer then we can realize how emerging markets are going to influence the order of the future. For this. we need to understand how the world was in 1820. The graph below depicts that the world was actually flat in 1820. All of were equally poor (or alternatively equally rich). So, something happened and some of them got extremely rich. This part of the history is known to all of us. Industrial revolution, scientific exposition, exploitation of raw material resources, Geo-political control over assets of the world by few are some of the reasons that we can attribute to how is world today.
Now we should know how the world is. Its unequal that is known to everyone, what we do not have estimated is how unequal is this world. Let us see
One can see from the above that percentage of population leaving less that 2 dollars in this world are quite big in numbers. If one can give a second glance to the picture above, one can realize that less than two dollar societies/nations are the ones which have the highest density of population. Sometimes it is difficult to differentiate between cause and effect. Whether poverty is the result of population growth or vice versa is a never ending debate. But with poverty comes malnutrition, high child mortality rate, civil wars, unstable governments and genocides. The focus shifts to just survival and control of the situation than growth, prosperity and development. It is surprising to find out there are many African countries which are surviving purely on the basis of donations. We do not know what will happen to these nations if economies of so called developed nations do not show signs of improvement in near future.
This column has no intention to sound like a doom's day proposition. There is always hope in life, in people and in nations. If the word 'hope' will vanish from our society, then there will be nothing left. So there are nations that are emerging out of this set of hopelessness and making us to believe that the story from 1820 to 1990 is not going to be repeated again and again.
I do not believe this darkness will endure.” J.R.R Tolkien
So we have countries that we can classify as extremely poor and moderately poor. The following two images present about the distribution of countries as per the above. The extreme poor countries will take a longer time to come out of poverty. I will write about these countries sometime latter and suggest pathways for them to grow based on my readings.
We will focus on nations which are moderately poor and which have an opportunity to grow in future. The following figure is a representation of nations under the category called 'moderately poor'
Some of these 'moderately poor countries' are growing very fast. These nations with social and business activity in the process of rapid growth and industrialization can be coined as 'emerging economies'. Some authors have called them as 'emerging markets' and some as 'frontier economies'. These countries are shifting their primary occupation from agriculture to industrial activities. Economic growth is the increase in the amount of goods and services purchased by an economy over time. This is backed up by what we call as ' increase in purchasing power'. We measure this in the form of growth in GDP (Gross Domestic Product) calculated in real terms (inflation adjusted). There are social changes happening due to shift in occupational pattern, degree of urbanization. Social change and economic development are closely related with technological innovation, particularly increase in availability of energy and opportunity for flow of financial resources to the productive system. These are possible due to various reforms, these countries have undertaken and opening up of these economies to foreign capital. Everything is not that rosy in these markets. There is still control of economy and prohibitive policies for healthy growth if industry and business- but changes are happening and they are happening for good and helping these economies to get integrated in new global order in a rate faster than many developed economies.
let us conclude with hope that there will be change and we will see over the pages how these changes are moderated and strategies can be developed to increase the likelihood of success in these markets.
Why are we discussing about emerging markets? If we can have a suitable answer then we can realize how emerging markets are going to influence the order of the future. For this. we need to understand how the world was in 1820. The graph below depicts that the world was actually flat in 1820. All of were equally poor (or alternatively equally rich). So, something happened and some of them got extremely rich. This part of the history is known to all of us. Industrial revolution, scientific exposition, exploitation of raw material resources, Geo-political control over assets of the world by few are some of the reasons that we can attribute to how is world today.
Now we should know how the world is. Its unequal that is known to everyone, what we do not have estimated is how unequal is this world. Let us see
One can see from the above that percentage of population leaving less that 2 dollars in this world are quite big in numbers. If one can give a second glance to the picture above, one can realize that less than two dollar societies/nations are the ones which have the highest density of population. Sometimes it is difficult to differentiate between cause and effect. Whether poverty is the result of population growth or vice versa is a never ending debate. But with poverty comes malnutrition, high child mortality rate, civil wars, unstable governments and genocides. The focus shifts to just survival and control of the situation than growth, prosperity and development. It is surprising to find out there are many African countries which are surviving purely on the basis of donations. We do not know what will happen to these nations if economies of so called developed nations do not show signs of improvement in near future.
This column has no intention to sound like a doom's day proposition. There is always hope in life, in people and in nations. If the word 'hope' will vanish from our society, then there will be nothing left. So there are nations that are emerging out of this set of hopelessness and making us to believe that the story from 1820 to 1990 is not going to be repeated again and again.
I do not believe this darkness will endure.” J.R.R TolkienSo we have countries that we can classify as extremely poor and moderately poor. The following two images present about the distribution of countries as per the above. The extreme poor countries will take a longer time to come out of poverty. I will write about these countries sometime latter and suggest pathways for them to grow based on my readings.
We will focus on nations which are moderately poor and which have an opportunity to grow in future. The following figure is a representation of nations under the category called 'moderately poor'
Some of these 'moderately poor countries' are growing very fast. These nations with social and business activity in the process of rapid growth and industrialization can be coined as 'emerging economies'. Some authors have called them as 'emerging markets' and some as 'frontier economies'. These countries are shifting their primary occupation from agriculture to industrial activities. Economic growth is the increase in the amount of goods and services purchased by an economy over time. This is backed up by what we call as ' increase in purchasing power'. We measure this in the form of growth in GDP (Gross Domestic Product) calculated in real terms (inflation adjusted). There are social changes happening due to shift in occupational pattern, degree of urbanization. Social change and economic development are closely related with technological innovation, particularly increase in availability of energy and opportunity for flow of financial resources to the productive system. These are possible due to various reforms, these countries have undertaken and opening up of these economies to foreign capital. Everything is not that rosy in these markets. There is still control of economy and prohibitive policies for healthy growth if industry and business- but changes are happening and they are happening for good and helping these economies to get integrated in new global order in a rate faster than many developed economies.
let us conclude with hope that there will be change and we will see over the pages how these changes are moderated and strategies can be developed to increase the likelihood of success in these markets.
