 | McKinsey experts - Unlocking the potential of emerging markets |
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Annual consumption in emerging markets will rise to $30 trillion, from $12 trillion, by 2025. Emerging markets could account for more than 70 percent of global economic growth during this period. McKinsey experts discuss how multinationals can harness the biggest economic force in the history of capitalism. While executives recognize that winning in emerging markets in the key to long-term growth, many companies remain reluctant to commit resources and talent at scale. McKinsey research shows that the largest companies headquartered in developed economies currently derive only 17 percent of their revenues from emerging markets, even though these markets already represent 36 percent of global GDP. Moreover, despite advantages in scale, technology, and access to capital, multinationals often lose out to more nimble local competitors. A massive wave of urbanization is propelling growth across the emerging world. This urbanization wave is shifting the world’s economic balance toward the east and south at unprecedented speed and scale. It will create an over-four-billion-strong global “consumer class” by 2025, up from around one billion in 1990. And nearly two billion will be in emerging-market cities. These cities will inject nearly $25 trillion into the global economy through a combination of consumption and investment in physical capital. This is a very significant shot in the arm for a global economy that continues to suffer from pockets of acute fragility. http://www.mckinseyquarterly.com/Strategy/Globalization/ SOURCE: McKinseyQuarterly.com |
