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In Focus: The Future 7

Euromonitor International

http://www.portal.euromonitor.com/Portal/ResultsList.aspx

08 October 2010

The Countries & Consumers team has identified the Future 7 (F7)as the world's next big emerging market economies: Argentina, Egypt, Indonesia, Mexico, South Africa, Turkey and Vietnam. Looking towards the next big investor opportunities is particularly importantamid a fragile global economic recovery, following the worst economic recession in 60 years in 2008-2009. Major emerging markets are leading the world recovery.

Investors are looking for countriesthat offer sustained economic growth potential, particularly following the success of the BRIC countries. Many major advanced economies will continue to face subdued economic growth as governmentsbattle rising debt levels and implement austerity measures. Population ageing which is more pronounced in developed economies will further weigh on economic growth as labour markets shrink and governmentfinances are under pressure. In 2020, the population aged 65+ will account for 8.0% of the total population in emerging and developing countries compared to 19.5% in developed economies. Thesefactors will cement the rising importance of emerging markets in the economic world order.

The F7 offer long-term investment potential, young, growing and urbanising populations, as well rising incomelevels and an expanding middle class. Investor interest will attract Foreign Direct Investment (FDI) inflows which will aid their economic development. These factors will transform their consumermarkets offering exciting opportunities for consumer goods and services:

• Growth in the F7 economies will be driven by rising domestic demand and a stronger external sector. GDP per capita in the F7economies is expected to increase by 45% between 2010 and 2020 (real terms);

• The F7 population totalled 672 million in 2010 and will reach 741 million by 2020, accounting for 1-in-10 global...