Emerging Companies Face Potential Challenges in Meeting Demands of Developing Markets

HSBC and Standard Chartered have both recently issued reports on their view of where the world economy is going over the next 20 to 40 years and they agree that rich nations will grow more strongly than emerging ones, due to primarily to the much slower rate of population growth in the developed world.  An article summarizing the reports in Businessweek quotes Standard Chartered as advising that "the continuing success of developed countries will depend more than ever on creativity".  Among other things, this means that emerging companies in the US and in other industrialized countries will need to plan for meeting the expected surge of demand in emerging markets for sophisticated goods and services.  Perhaps just as important, managers of those emerging companies must also take into account the especially challenging scenario that firms in developing countries such as China and India will, as Businessweek says, “move so fast up the learning curve that they provide their own sophisticated goods and services”.

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