Companies in emerging markets to increase spending
Companies in emerging markets are likely to increase spending and investment this year, a survey of senior finance executives shows
Several emerging market senior finance executives reported "exuberant expectations for economic growth" in their regions and plans to boost spending and investment, American Express' sixth annual Global Business and Spending Monitor showed.
The survey, carried out among 519 senior finance executives in the first half of this year, shows that Latin American and Asian countries are the most aggressive when it comes to investment.
The most likely to increase spending and investment substantially (by 10% or more) were finance executives in Argentina and India, with 75% saying they plan to do so, followed by those in Brazil and China, with 71%, and in Mexico with 57%.
Among the least likely to increase investment and spending substantially are financial executives in Canada (only 31% plan to do so), France (22%) and the US (17%).
"After years of global economic uncertainty, companies in emerging markets are clearly poised to take advantage of market opportunities and drive growth," Shane Berry, Senior Vice President, Global Corporate Payments Global Client Group, American Express, said in the statement.
"Thats not to say that mature economies arent also looking to increase investments, but recent history has made them much more cautious."
Executives in emerging markets are also bullish on economic growth; 100% of those surveyed in Brazil said they expected economic expansion, 94% of those in China and Hong Kong and 81% of those in Mexico.
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The least optimistic about economic growth were those in France and Russia which bucked the optimistic trend in other major emerging markets with just 39% expecting economic expansion, followed by Spain, with 43%, and the UK, with just half of finance executives surveyed expecting economic growth.
When it came to deciding where they wanted to expand investment, 54% of respondents said they planned to spend more on market access such as expansion into new countries or regions or developing new lines of business.
Other areas where spending would be boosted include improving production-process efficiency, new product development, administrative process efficiency and new production capacity.
"We're seeing a blend of overall optimism regarding the economy off-set by short-term local concerns, translating into different planning horizons for different markets," said Berry.
"There's a new normal emerging in the global marketplace where CFOs will demand value from both investments and existing processes, creating a value economy for growth."
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