Great Expectations for Vietnam Market

Vietnam has held its place for the third year running at the top of a list of emerging markets, outside of the BRICs (Brazil, Russia, India and China), according to global investors surveyed by the UK Trade & Investment and the Economist Intelligence Unit.

 

The ‘Great Expectations: Doing business in emerging markets’ report offers new insights from international investors about which markets they see as being the global growth engines of the future.

The report is based on a survey of more than 520 global executives from every sector. All respondents are already doing business in emerging markets or plan to do so in the next two years.

 

Emerging markets will be your company’s main targets for new and/or increased investment over the next two years.

 

Launching the new research this morning, Mr Vince Cable, the UK Business Secretary, said: “The balance of global power is shifting and this is recognized in UK Trade & Investment’s research. UK firms are using their expertise to help promote that growth.

 

According to the resort, the top three markets for investors in the next two years are China (20%), Vietnam (19%) and India (18%). Vietnam has been selected as the number one investment destination, beyond the BRICs, for the third consecutive year.

 

Emerging markets are now viewed as sources of new consumer demand, ahead of simply being low-cost production hubs. 76% of investors see emerging markets as a source of new business growth. This is compared with just 23 per cent looking for a low-cost manufacturing base. Only one quarter of companies intend to rely on their existing products and services in emerging markets. Most companies intend to customise their offerings for new markets.

 

71% of respondents agreed that emerging markets beyond the BRIC countries collectively offer an opportunity too big to ignore. Companies are now prioritising a range of "second-tier” countries alongside their well-established operations in the BRIC countries.

 

For many, emerging markets are increasingly familiar places. Nearly half of the respondents have been operating in one or more emerging markets for at least a decade and two-thirds have been there for six years or more. Institutional knowledge of these countries is far higher than it was at the turn of the century.

 

Far more executives believe that the potential rewards far outstrip the risks within both the BRIC countries and other emerging markets. 52% expect growth prospects for their once-risky emerging markets business to be significantly better over the next two years.

 

Local companies in emerging markets are sought after for partnerships and alliances. Despite a greater ease with the risks of new places, the need to tap into local knowledge and contacts quickly remains strong.

 

Emerging markets are not just for big business. One in three SMEs polled plan to expand into one new emerging market over the next two years through joint ventures or partnerships with local companies.

 

UK Trade & Investment (UKTI) is the government department that helps UK-based companies succeed in the global economy. UKTI also helps overseas companies bring their high quality investment to the UK’s economy - acknowledged as Europe’s best place from which to succeed in global business. UKTI offers expertise and contacts through its extensive network of specialists in the UK, and in British embassies and other diplomatic offices around the world. UKTI provides companies with the tools they require to be competitive on the world stage.