Everything about Emerging Markets totally explained
The term
emerging markets is used to describe a nations social, equity, or business activity in the process of
industrialization or emerging into the world community.
Terminology
Originally brought into fashion in the 1980s by then World Bank economist
Antoine van Agtmael, the term is sometimes loosely used as a replacement for
emerging economies, but really signifies a business phenomenon that isn't fully described by or constrained to geography or economic strength; such
countries are considered to be in a transitional phase between
developing and
developed status. Examples of emerging markets include
China,
India,
Mexico,
Brazil,
Chile, much of
Southeast Asia,
South Asia, countries in
Eastern Europe, the
Middle East, parts of
Africa and
Latin America. Emphasizing the fluid nature of the category,
political scientist Ian Bremmer defines an emerging market as "a country where politics matters at least as much as economics to the markets."
The research on emerging markets is diffused within
management literature. While researchers including
C. K. Prahalad,
George Haley,
Hernando De Soto,
Usha Haley,
Rajesh K Pillania and several professors from
Harvard Business School and
Yale School of Management have described activity in countries such as India and China, how a market emerges is little understood.
It appears that emerging markets lie at the intersection of non-traditional user behavior, the rise of new user groups and community adoption of products and services, and innovations in product technologies and platforms.
The term "rapidly developing economies" is now being used to denote emerging markets such as The
United Arab Emirates,
Chile and
Malaysia that are undergoing rapid growth.
In recent years, new terms have emerged to describe the largest developing countries such as
BRIC and
BRIMC that stand for
Brazil,
Russia,
India,
Mexico, and
China. These countries don't share any common agenda, but some experts believe that they're enjoying an increasing role in the world economy and on political platforms.
A large number of research works are in progress at leading universities and business schools to study and understand various aspects of Emerging Markets.
List of countries
It is difficult to make an exact list of emerging (or developed) markets; the best guides tend to be investment information sources like
ISI Emerging Markets and
The Economist or market index makers (such as
Morgan Stanley Capital International). These sources are well-informed, but the nature of investment information sources leads to two potential problems. One is an element of historicity; markets may be maintained in an index for continuity, even if the countries have since developed past the emerging market phase. Possible examples of this are
South Korea,
Taiwan,
Israel, and
Czech Republic. A second is the simplification inherent in making an index; small countries, or countries with limited market liquidity are often not considered, with their larger neighbours considered an appropriate stand-in.
The
Big Emerging Market (BEM) economies are
Argentina,
Brazil,
China,
Egypt,
India,
Indonesia,
Mexico,
Poland,
Russia,
South Africa,
South Korea and
Turkey.
Newly industrialized countries are emerging markets whose economies have not yet reached first world status but have, in a macroeconomic sense, outpaced their developing counterparts.
As of
June 2006, the
Morgan Stanley Emerging Markets Index
included:
- Argentina
- Brazil
- Chile
- China
- Colombia
- Czech Republic
- Egypt
- Hungary
- India
- Indonesia
- Israel
- Jordan
- Malaysia
- Mexico
- Morocco
- Pakistan
- Peru
- Philippines
- Poland
- Russia
- South Africa
- South Korea
- Taiwan
- Thailand
- Turkey
Hong Kong, Singapore and Saudi Arabia included (MSCI classifies the first two as Developed Markets) -- and Jordan omitted.
Further Information
Get more info on 'Emerging Markets'.
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