Business in Emerging Markets Essay Example | Topics and Well Written Essays - 2500 words

Business in Emerging Markets - Essay Example The Multinational Companies (MNCs) that have experience in working in developed markets have started to drift their interests towards emerging markets such as Latin America, Asia, Africa and the Middle East. This is because they have attained a saturation point in these wealthy developed economies and condensed their profit margins (Arnold and Quelch, 1998). These economies offer a lucrative ground for investments mainly due to their potential client base and a significant perspective for growth in the future. Emerging markets are usually characterized by a record of recession and economic depression and a stagnant economy. These economies exhibit a political scenario of unrest and turbulence, an aging population, low fertility rates and slow growth rates in the industrial sectors. However, these markets provide some of the peak economic growth indicators and give way for the MNCs to step in and expand their markets (Rahman and Bhattacharya, 2003). According to Rahman and Bhattacharya, there are typically three criteria that define a developing nation as an emerging market. The first one is that the nation identified as an emerging market should have a promising potential to return large profits and economic growth in the future. Second, the nation needs to be open to overseas investments and should have economic policies that promote foreign investments. Also, this exposure to foreign investments and the related policies should undergo continuous evolution so as to foster further investments and hence, greater economic growth.