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competitive-alternatives-business-locations2For the first time, Competitive Alternatives 2012 compares five leading high growth countries—Brazil, China, India, Mexico, and Russia. Over the last decade, these five countries have nearly doubled their share of world output and they now account for one fifth of global GDP. In 2010, China became the world's second largest economy, overtaking Japan and now ranking only behind the United States. In recent years, China has also surpassed both Germany and the United States to become the world's leading exporter.

The rapid economic growth in these countries has been integrally linked with their lower labor costs and increasing importance in global supply chains. Rapid economic growth has also led to the emergence of a large and growing middle class in these countries, creating a more self-sustaining economic base.

While the high growth markets offer many opportunities to business, there are numerous factors to consider before deciding where, how, and why to enter these markets. These countries have all experienced similarly high rates of economic growth in recent years, yet they still differ greatly in many other regards. Competitive Alternatives 2012 details a range of cost and non-cost issues related to the high growth markets, including:
Population/demographics – The high growth countries generally have a young age demographic, providing advantages for both labor supply and consumption. Russia is an exception in this regard, with population aging issues similar to the mature countries. China is also projected to move rapidly to an aging population demographic over the next two decades.

Education/skilled labor – Access to education has been growing rapidly in the high growth markets, as has the demand for skilled workers. However, issues exist around both the quality of education in certain areas, and skill shortages in certain fields as demand for educated workers has outstripped the growth of the education systems.

Innovation – High growth economies, particularly China and India, have historically focused on process and secondary product innovation in pursuit of production cost efficiencies. However, relatively high rates of wage inflation in recent years have been eroding the labor cost advantages in these countries, leading to an increased focus on higher value added innovation.

Infrastructure – Infrastructure levels in the high growth countries are generally behind those of the mature countries. China stands out among the high growth countries in recent years for the sheer scale of its infrastructure investments – particularly in the rapid development of its transportation and distribution networks.

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