Emerging Market Firms Investing in Each Other's Home Essay

Emerging Market Firms Investing in Each Other's Home - Essay Example China is one example of a developing market that makes its investments in other developed economies and also provides market to the developed economies such as Germany and Britain. Another example of a developing economy that deals in foreign direct trade with other emerging markets is Brazil. Signing of world currency deals with developed countries as well as emerging economies have been witnessed in the recent past. Sauvant (2009) argues China for instance has signed such agreements with various countries such as Argentina, Russia, united Arabs emirates, India and South Africa. This was made with an aim of ensuring financial safety by creating a joint pool risk mitigation mechanism. Foreign direct entry among emerging markets and developed economies Firms within nations with emerging economy; must be protected from foreign firms from developed nations which have competitive advantage as realized in the above mentioned examples. These calls for trade among nations with emerging mark ets by regulating market entry by other firms. Ken-lchi (2005) emphasizes, for this to change, firms from developed nations must adopt different mechanisms for market penetration. This calls for trade among nations with emerging markets by regulating market entry by other firms. For this to change, firms from developed nations must adopt different mechanisms for market penetration. This calls for trade among nations with emerging markets by regulating market entry by other firms. For this to change, firms from developed nations must adopt different mechanisms for market penetration. Lack of such change would see unto it that firms in developing nations develop economically and enhance world-class competence. It is argued that China, for instance, would be a good example in offering alternatives which would have otherwise been sought for from developed nations Rugman (2012) argues, the support for this is the angle of perception of emerging markets as the crucial point o driving the economy owing to the fact that developing countries are growing in number. Scramble for resources creates more pressure hence expectations are made on the first mover longer steps over the emerging heroes. Competition will be realized among emerging markets in regions such as Middle East and Africa through their government. This ability of providing alternatives by developing nation’s blocks developed nations from accessing the markets. Emerging markets have recorded better growth Brazil, china and India are the best examples of emerging markets in the world today. Chinese are known for the increased production as well as large population which provide both affordable labor and market for products. As a matter of facts, developed economies target such emerging markets so as to have a two way mutual benefit among them. Germany has a history of industrial production that majors on steel work. According to Fayolle & Todotoy (2011), this becomes a raw material for the emerging ec onomies in the process of production so that the developed country, in this case Germany exports the product to the emerging economy such as china. India has also recorded an increase in production hence targeted by the developed economies such as Europe in terms of foreign trade. There are challenges that the new economies pose to developed economies in terms of economic strength. This may be evident between Europe and United States as developed economies as well as India, china and Brazil which are the strong emerging economies. Operating at relatively same level of financial ability becomes the driving force. The establishment of enterprises in other countries will follow the emergence of markets for the products which would come from either