Despite political risk, chemical companies expect big gains in emerging markets: survey

Chemical company executives from around the world expect 38 per cent of their global revenues to come from emerging markets by 2017 on average, up from 19 per cent today, according to a new survey by market research firm Global Intelligence Alliance (GIA).

The largest percentage of growth is expected to come from Brazil, Russia, India, and China (called the BRIC countries). After the BRIC countries, the top emerging markets to target up to 2017 will be Indonesia, South Africa, Saudi Arabia and Vietnam.

The 20 chemical industry executives in GIA’s Business Perspectives for Emerging Markets 2012-2017 report said they are investing in emerging markets in order to gain a foot hold in future large markets.

The survey shows political risk to be the primary threat to multinational players in emerging markets over 2012 to 2017. Other threats are competition from local companies, poor infrastructure and cost of international supply chain.

Overall, 60 per cent of the respondents said that decision making is delayed because of lack of information, while 75 per cent doubt the accuracy and completeness of the information they do have on emerging markets.

Not surprisingly therefore, 91 per cent said they would like to have done something differently in how they planned and executed their emerging markets strategy. Some would like to have made greater efforts to adapt to local conditions, while others would have entered emerging markets earlier or ensured they had better local market intelligence and due diligence.

For more on the survey, click on this link.