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Monday 10th of January 2011
January 7, 2011    

UK exporters: emerging markets or join “slow lane of history”

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by Gill Montia
UK exporters: emerging markets or join

A new report from PricewaterhouseCoopers (PwC) is urging UK companies to focus on emerging markets, or join the “slow lane of history” by continuing to focus on markets in North America and Western Europe.

In PwC’s latest “World in 2050″ series, the firm’s head of macroeconomics, John Hawksworth, comments: “Rapid growth in consumer markets in the major emerging economies associated with a fast growing middle class will provide great new opportunities for Western companies that can establish themselves in these markets.”

However, he warns that competition will be strong and that companies determined to become established in emerging markets will need to make long-term investments.

According to the study, the UK currently sells only around 7% of its exports to Brazil, Russia, India and China (even including Hong Kong as part of China), or about the same as it exports to Ireland at present.

Meanwhile, PwC is predicting that the Chinese economy is likely to be larger than that of the US before 2035, and that the E7 emerging economies will overtake the G7 before 2040.

Mr Haksworth therefore argues: “If the UK is to achieve trend growth of more than about 2% in the long run, then it needs to find a way to break into these fast-growing emerging markets on a much larger scale than achieved so far.”

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