1. Emerging Markets
Chapter 9

2. Stages of Economic Development
1. The Traditional Society
2. The Pre Conditions for Take-off
3. The Take-Off
4. The Drive to Maturity
5. The Age of High Mass Consumption
9-2
SOURCES: Walt W. Rostow, The Stages of Economic Growth 2d ed.
(London: Cambridge University Press, 1971), p.10.
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3. United Nations Economic
Development System
More-Developed Countries (MDC)
9-3
Less-Developed Countries (LDC)
Least-Developed Countries (LLDC)
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4. Newly Industrialized Countries
Growth Factors
 Political Stability
 Economic and Legal Reforms
 Entrepreneurship
 Central Planning
 Outward Orientation
 Factors of Production
 Industries Targeted for Growth
 Financial Incentives
 Privatized State-Owned Enterprises
 Large, Accessible Markets
 Low Tariffs
9-4
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5. Infrastructure of Selected Countries
United States 6, , ,696
Brazil 1, , ,925
Japan 1, , ,182
Colombia , ,147
Germany , ,680
Kenya
Mexico , ,898
Spain , ,728
India 1, ,
South Africa , ,020
China ,
Highways* Railways Trucks Electricity
(paved km) (km) and Buses Production
Country (000) (000) in Use (000) (kwh per head)
*Includes unpaved and paved.
9-5
SOURCES: For additional information, see International Marketing Data and Statistics, (London: Euromonitor Pulications, 1997); and “Indicators of Market Size for 115 countries, “ Country Monitor, December 25, 2000.
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6. Common Traits of Big Emerging Markets
 Are physically large.
 Have significant populations.
 Represent considerable markets for a wide range of products.
 Have strong rates of growth or the potential for significant growth.
 Have undertaken significant programs of economic reform.
 Are of major political importance within their regions.
 Are "Regional Economic Drivers".
 Will engender further expansion in neighboring markets as they grow.
9-6
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7. Big Emerging Markets
Population GDP GDP Trade*
(millions) ($ billions) (per capita) ($ billions)
Asia ASEAN^ $666.0 $ 15,317 $ 1,294.8 CEA (Chinese Economic Area)‡ 1, , ,141 1,109.0 India 10, South Korea ,
Latin America Mexico ,
Argentina ,
Brazil ,
Africa South Africa ,
Europe Poland , Turkey ,
Possible Additions Colombia , Venezuela ,
9-7
* Imports and exports.
^ASEAN includes Brunei, Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam.
‡CEA consists of the provinces of Southern China, Hong Kong, and Taiwan.
SOURCES: For additional information, see “indicators of Market Size for 115 countries, ” Country Monitor. December 25, “Direction of Trade Statistics Yearbook, International Monetary Fund, 2000, and visit
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8. The Americas 9-8 Irwin/McGraw-Hill CANADA UNITED STATES MEXICO CHILE
CUBA
CANADA
UNITED STATES
MEXICO
Alaska
(United States)
Hawaii
BRAZIL
BOLIVIA
PARAGUAY
URUGUAY
ARGENTINA
PERU
ECUADOR
VENEZUELA
Montreal
PACIFIC OCEAN
GUYANA
SURINAME
FRENCH GUIANA
GUATEMALA
ST. SALVADOR
COSTA RICA
PANAMA
GREENLAND (DENMARK)
CHILE
Toronto
Detroit
Chicago
Los Angeles
San Francisco
Dallas
COLOMBIA
HONDURAS
NICARAGUA
Miami
JAMAICA
HAITI
Buenos Aires
Belo Horizonte
Rio de Janeiro
Sao Paulo
9-8
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9. Economic and Social Data for Selected Countries
Consumer Spending Hospital Number Literacy Tourism
Food Percent Clothing Percent Beds per of (Percent) Receipts
($ million) of ($ million)** of (000s) Doctors ($ million)**
Country Total* Total* Population
9-9
United States $ 741, % $221, % , % $45,579
Argentina 16, % 2, % , % 2,336
Brazil 81, % 12, % , % 1,559
Colombia 9, % 1, % , % 410
Mexico 57, % 12, % , % 4,355
Venezuela 15, % 3, % 2.6 *28, % 36.5
* Percent of all consumer spending.
** In U.S. dollars, basis 1988.
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10. Eastern Europe and the Baltic States
ESTONIA
LATVIA
LITHUANIA
POLAND
CZECH REPUBLIC
SLOVAKIA
HUNGARY
ROMANIA
BULGARIA
ALBANIA
YUGOSLAVIA
MACEDONIA
BOSNIA AND HERCEGOVINA
CROATIA
GREECE
SLOVENIA
TURKEY
Gulf of Finland
Baltic Sea
9-10
Black Sea
Adriatic Sea
Tyrmenian Sea
Aegean Sea
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11. Eastern European Markets
Population GDP GDP Exports Imports
(millions) ($ billions) ($ per capita) ($ millions) ($ millions)
Albania 3.28 $ 2.7 $ 820 $ 80 $ 147
Bosnia/ Herzegovina (*) NA NA
Bulgaria ,220 4,303 3,271
Croatia (*) ,600 4,633 7,582
Czech Republic(**) ,050 14,575 16,284
Hungary ,505 19,100 15,224
Macedonia(*) ,400 1,244 1,420
Poland ,500 25,751 42,307
Romania ,544 8,385 10,131
Slovakia(**) ,763 12,063 13,003
9-11
(*) Former republics of Yugoslavia.
(**) Former republics of Czechoslovakia.
Sources: “Indicators of Market Size for 115 Countries,” Country Monitor,
December 25, 2000; and International Trade Statistics yearbook (New York:
United Nationa, 2999).
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12. Asia CHINA 9-12 INDIAN OCEAN JAPAN Irwin/McGraw-Hill MONGOLIA INDIA
PAKISTAN
NEPAL
BHUTAN
BANGLADESH
MYANMAR
LAOS
VIETNAM
CAMBODIA
THAILAND
TAIWAN
S. K0REA
JAPAN
N. K0REA
PHILIPPINES
Hong Kong
MALAYSIA
SINGAPORE
SRI LANKA
INDIAN OCEAN
INDONESIA
BRUNEI
9-12
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13. Asian Markets - Selected Countries
Population GDP GDP Exports Imports
(millions) ($ billions) ($ per capita) ($ millions) ($ millions)
Australia 18.5 $ $ 22,000 $ 52,966 $ 61,347
China 1, , ,007
Hong Kong , , ,764
India ,537 34,456
Indonesia ,076 43,285 39,456
Japan , , , ,871
South Korea , , ,153
Taiwan , , ,652
9-13
SOURCES: “Indicators of Market Size for 115 Countries,”
Country Monitor. December 25, 2000; and S.T.E.T.
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14. Capitalism with Chinese Characters Jiang Zemin’s Reform Agenda
 Restructure state enterprises. SOEs account for about two-fifths of the industrial output but soak up four-fifths of investment.
 Strengthen financial markets. Expand and ensure the integrity of capital markets.
 Sell state assets. Sell off all but 1,000 of China’s 305,000 state enterprises and allow some to go bankrupt.
 Build social services. Create housing, pension programs, and other services to relieve burdens on SOEs and to care for millions who may lose jobs.
 Slash tariffs. Reduce average tariffs to 17 percent in 1997 and to 15 percent by 2000 as part of China’s bid to join the World Trade Organization.
9-14
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15. India’s Five-Point Agenda
The improvement of the investment climate.
The development of a comprehensive WTO strategy.
The reformation of the agriculture, the food processing, and the small-scale industry.
The elimination of red tape
The institution of better corporate governance.
9-15
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16. Living Standards in Selected Countries
Percent of Households
Households Persons per Piped Flush Electric
(000) Household Water Toilers Lighting
Brazil 38, % 76% 69%
Chile 3, % 59% 88%
China 357, % NA NA
Colombia 8, % 64% 87%
Ecuador 2, % 33% 62%
Hong Kong 1, % 80% 93%
India 185, % 5% 16%
Indonesia 43, % 15% 30%
Japan 40, % 65% 98%
Peru 5, % 43% 48%
Philippines 12, NA NA NA
Singapore % 42% 37%
South Africa 13, % 35% 90%
United States 100, % 99% 99%
9-16
SOURCES: For additional data, see Demographic Yearbook (New York: United Nations, 1997); and International Marketing Data Statistics, 18th ed. (London: Euromonitor Publications, 1997).
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17. Which of the Following have you Purchased in the Past Three Months?
Product Percent Percent Percent Percent Percent Percent
in in in in in in
United Australia Brazil Germany Japan United
States Kingdom
9-17
Soft drinks
Fast-food
Athletic footwear
Blue jeans
Beer*
Cigarettes*
* Among adults 18+. Source: Yankelovich Clancy Shulman.
SOURCE: Nancy Giges, "Global Spending Patterns Emerge," Advertising Age, November 11, 1991, p. 64.
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18. Consumption Patterns in Selected Countries (percent of household expenditures)
U.S. Germany Singapore Mexico Poland Iran Kenya Thailand India
Food 10% 12% 19% 35% 29% 37% 38% 30% 52%
Clothing 6% 7% 8% 10% 9% 9% 7% 16% 11%
Gross rent 18% 18% 11% 8% 6% 23% 12% 7% 10%
Medical care 14% 13% 7% 5% 6% 6% 3% 5% 3%
Education 8% 6% 12% 5% 7% 5% 10% 5% 4%
Transport/ communications 14% 13% 13% 12% 8% 6% 8% 13% 7%
Appliances/ other durables 30% 31% 30% 25% 35% 14% 22% 24% 13%
9-18
SOURCE: For additional data, see Ricardo Sookdeo, "The New global consumer." Fortune, Autumn-Winter 1993, pp
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19. Living Standards in Selected Countries
Percent of Households
Country Household Persons per Piped Flush Electric
(000) Household Water Toilets Lighting
Brazil 38, % 76% 69%
Chile 3, % 59% 88%
China 357, % N/A N/A
Colombia 8, % 64% 87%
Ecuador 2, % 33% 62%
Hong Kong 1, % 80% 93%
India 185, % 5% 16%
Indonesia 43, % 15% 30%
Japan 40, % 65% 98%
Peru 5, % 43% 48%
Philippines 12, NA N/A N/A
Singapore % 42% 37%
South Korea 13, % 35% 90%
United States 100, % 99% 99%
9-19
SOURCE: Demographic Yearbook 1997 (New York: United Nation, 1997); and International Marketing Data and Statistics, 1997 (London: Euromonitor Publication, 1997)
Irwin/McGraw-Hill