As the world economy becomes more global, it is important for business to understand how to stay on top. Companies are always looking for ways to stay competitive in an environment that isn’t always fair and has recently become open to countries like China, India and Brazil.
Projections show that the US GDP (currently the highest GDP in the world) will fall to third by the year 2050 behind emerging powerhouses China and India (the US is projected to fall behind China in terms of GDP as early as 2018). Brazil is projected as a distant 4th, but coming on strong. Granted the numbers are projecting 40 years out, and such things are volatile, but the idea remains in principle.
According to a presentation in March by Nitish Singh, Assistant Professor of International Business at Saint Louis University, China and India are producing 500,000 scientists and engineers per year. Obviously, this gives greater opportunity for domestic companies to outsource their software development projects, but it also means that there is an educated market emerging for domestic companies to sell to.
Domestic markets are no longer en vogue for American companies, they need to think global. On the other side of the coin, with growing international companies also comes higher value for international currency and subsequent lower value for domestic currency.
In much the same way, but to a lesser extent, that US consumers will buy stuff in Mexico due to the favorable exchange rate, buyers in China and India will be more inclined to buy American products due the depreciated exchange rate of the dollar. You could call it the light at the end of the tunnel in what has been a tough domestic economy in recent years. For a more in depth look at how international markets are emerging, read Philip Guarino’s article on Elementi Consulting’s site.