By CBRE’s Eduardo Fernández-Cuesta, in Madrid | In a time of extraordinary global economic and political uncertainty, multinational corporations have focused their growth plans in the opportunities offered by emerging markets. Indeed, they are countries attractive for growth and increasingly popular.
Turkey, for example, grew by over 8% last year, becoming one of the fastest growing economies worldwide along with Brazil and Mexico, which has based its spectacular development in recent years in its middle classes’ progress, with all that that implies for consumption and therefore expansion of certain sectors and industries.
However, talk of emerging markets as a single entity with similar characteristics is a mistake because you can not compare, with their varied size and characteristics, some countries to others. Is it China the same as Brazil? Or Mexico and Turkey?
That is why, although it seems obvious, it is worth bearing in mind that in these processes of companies expanding into emerging markets (and even if we speak of any other market), it is essential to know the wide range of political norms, legal, fiscal frameworks (without going far, Brazil has a large exit tax burden to capital that must be evaluated), and the working culture that is intrinsic to each of them.
And so it is in regard to real estate or infrastructures. Planning is essential for rapid deployment, to be flexible in design, implementation and adaptation of key processes for the business itself. Hence, it is increasingly common for companies to leave these processes in the hands of a trained counsellor who knows and understands the specifics of each market. In fact, large consulting firms have created so-called Spanish Desks to centralise and streamline the needs of Spanish multinationals in countries like Brazil or Mexico. On such services depends that companies can be really focused on their business and not on collateral issues that may be an obstacle or hindrance to the normal development of the activity.
Likewise occurs with investors. To land in markets such as Brazil, for instance, is advisable to have sufficient critical mass to establish a presence and a strong image in the country in terms of track record. This requires joint efforts, aligned interests and achieving strategic business alliances able to convey strength and visibility.
These processes are becoming more intense today, and Spanish companies are approaching strategies through a 360 degree perspective. The goal is, after all, that being in emerging countries turns into an opportunity to generate business success.