Top 10 emerging markets around the world for Pakistani businesses

As the world evolves, the landscape of international business is constantly shifting. In recent years, we have witnessed the rise of emerging markets as key drivers of global growth. In fact, these developing markets contribute to the global Gross Domestic Product (GDP) growth by at least 50% year-on-year, according to World Economics.

With their dynamic growth rates, large consumer bases, and improving infrastructure, these markets present a world of trade opportunities for Pakistani entrepreneurs and companies seeking to thrive in the international arena.

This blog post will explore the list of top emerging markets for international business. We’ll delve into the characteristics that make them attractive, and the key opportunities and challenges that may lie ahead. These will provide valuable insights for businesses in Pakistan looking to succeed on the global stage.

Characteristics of emerging markets

Emerging markets are characterised by rapid economic growth, expanding middle classes, improving infrastructure, and increasingly favourable regulatory environments within the countries. These factors combine to make them particularly attractive for companies looking to diversify their operations and tap into new consumer bases. As a result, businesses that can localise their business for an overseas market can reap significant rewards.

Challenges and opportunities

According to the MSCI Emerging Markets Index, the top 10 emerging markets for international businesses are:

1. China: Hotbed for consumer products

A report by McKinsey & Company showed that China’s middle class grew from just 4% of urban households in 2000 to about 76% in 2022. From fashion and beauty to electronics and home appliances, the demand for imported goods is on the rise, providing Pakistani businesses with a wealth of export opportunities. While entering this market does require a nuanced understanding of China's regulatory landscape, it's a stimulating opportunity to learn and adapt to different business practices.

2. Brazil: Thriving agriculture economy

Latin America's largest and emerging economy, Brazil, offers a wealth of opportunities for businesses seeking to expand into the region. With its natural agricultural resources, growing consumer base, and improving infrastructure, Brazil is an appealing prospect. Additionally, Brazil's complex tax regulations and infrastructure limitations such as insufficient transportation networks can be viewed as opportunities for businesses adept at solving challenges. Successfully handling these intricacies can demonstrate adaptability and resilience, traits highly valued in the dynamic landscape of international commerce.

3. Indonesia: Expansive commodities sector

As the world's fourth most populous country, Indonesia presents a vast market for international businesses, with a rising demand for textiles and garments, food and beverages, and digital services. This opportunity comes in the form of 52 million strong Indonesians who make up the middle-class population, according to the World Bank, creating ample opportunities for growth. To thrive, businesses must embrace Indonesia's diverse cultural landscape and developing infrastructure, seeing them not as obstacles, but as opportunities for differentiation and local market understanding.

4. Mexico: Strategic trade location

Mexico's strategic location and strong trade ties with the United States make it an attractive market for international businesses. It also offers opportunities in the automotive, electronics, and food and beverage sectors, with the country's growing middle class and improving regulatory environment providing further incentives for expansion. While Mexico's customs regulations and infrastructure present unique demands, businesses that master these aspects can establish a strong presence and competitive edge in the market. Understanding these challenges will be key to unlocking Mexico's potential and enhancing customer satisfaction through efficient delivery systems.

5. Qatar: High-value international market

As one of the wealthiest countries in the Middle East, Qatar offers a high-income market for international businesses, especially in the realm of luxury goods, construction materials, and IT services. The country's ongoing diversification efforts, massive infrastructure investments, and hosting of major international events such as the FIFA World Cup 2022 also create opportunities for growth. While it's essential to be aware of the unique cultural customs and business etiquette in Qatar, such as a strong emphasis on hospitality, those who can adapt will be well-positioned to build meaningful relationships and network effectively.

6. Saudi Arabia: Source of talents

As the largest emerging economy in the Middle East, Saudi Arabia's wealth and strategic location make it an attractive market for international business. It is a country with opportunities in sectors such as construction, IT, and healthcare. While the country's ongoing diversification efforts and improving regulatory environment offer new opportunities, companies must remain sensitive towards Saudi Arabia’s cultural differences and religious importance, which can impact the types of products they can sell. 

7. South Korea: Digital hub

As a global leader in technology and home to a highly educated and skilled workforce, South Korea offers substantial potential for international businesses. The nation's robust infrastructure, along with a culture of innovation and a strong consumer market, provide a conducive environment for business expansion. While it's crucial to understand South Korea's specific regulatory framework and unique business practices, doing so will lead to a deep understanding of the market, ultimately providing a competitive edge. Moreover, catering to the highly digital and tech-savvy consumer base can open up a world of opportunities for businesses that are equipped to meet these progressive demands.

8. Turkey: Growing middle class

Turkey, positioned strategically between Europe and Asia, offers a sizable domestic market with vibrant textile, automotive, and food and beverage sectors. Its growing middle class, youthful demographics, and advancing infrastructure present an appealing platform for international business expansion. Mastering the art of adjusting to currency fluctuations and understanding the local business climate are integral steps towards seizing the abundant opportunities in this dynamic market.

9. South Africa: Stable environment

As the most developed economy in Africa, South Africa offers a relatively stable environment for international businesses looking to enter the continent's emerging markets. The country's advanced infrastructure, skilled workforce, and growing middle-class present opportunities for growth. While South Africa presents certain complexities like high unemployment rates and income disparity, these can also be seen as opportunities for businesses with job creation initiatives and solutions targeting different income groups. Understanding and addressing these socioeconomic factors is a vital part of successful business integration and growth in this diverse and evolving market.

10. Thailand: Accelerating and robust economy

Thailand, with its fast-booming economy, strategic Southeast Asian position, and burgeoning middle class, shines as an enticing prospect for international businesses. While Thailand does have a comprehensive regulatory framework, this can also be viewed as an opportunity for businesses with well-structured operations and solid legal guidance. This readiness not only ensures compliance but also builds trust and rapport with local partners and customers. Key sectors ripe for exploration include digital services, automotive, and food processing.