This Is Not an Academic Paper
What is the impact that the emerging world will have on future global economy?
The emerging economies once popular and attractive for its natural resources, cheap labour and low manufacturing costs now threaten the norm as far as international business participation is concerned. Our analysis of the effects of the shifting wealth on the international business or trade is discussed under the following subheadings:
The changes in global demand for goods and services
The changes in supply of goods and services
The changing Political climate
The new business model
The changes in global demand for goods and services
The worlds population is estimated to grow to by 2.3 billion people, eventually reaching 9.1 billion by 2050. (Howard;2012). A greater proportion of this population will live in the emerging world , and almost all will live in cities, often in cities not yet built (Howard; 2012). Shifting wealth is contributing tremendously towards the reduction of poverty in the developing economies. (Anonymous;2010,6) The number of poor people in emerging economies declined by 120million in the 1990s and by nearly 300 million in the first half of 2000s (Anonymous;2010,6). This is signifies a general improvement in welfare as GDP per capita increases therefore increasing demand for certain commodities.
As the emerging economies grow and progress towards their own prosperity, China for example being an export powerhouse, has a domestic market will become increasingly important to supply beyond 2020. This will increase the level of competition amongst multinationals striving to service these now booming emerging markets. Consumers estimated to earn high salaries will increase the demand for high quality goods and services. In this case China will have to adapt and invest in resources to innovate and manufacture goods for this emergent domestic market in order to remain competitive. This is also true for India whose growth is expected to supersede that of China due to India having a significantly higher and faster growing population than China with a one child policy. Overall the demand for branded high quality goods is expected to rise.
The changes in supply of goods