The paper "Implications for International Firms - CVC Capital and Vodafone" is a perfect example of a business case study. The proliferation of international firms seeking business opportunities in emerging markets started some 200 years ago, although they were essential in the form or portfolio. Today, foreign investments are characterised by joint-venture and greenfield investments (Adeoye 2009). Many international firms are seeking emerging and developing economies in their strategies to secure optimal returns in usually inefficient and opaque markets. Despite the fact that these investments correlated with increase regulatory, political and currency risks, foreign direct investments are rapidly trending in response to the increased globalisation (Ganster 2001).
This essay examines the implications for international firms doing business within an emerging and the macro-economic factors considered in choosing locations in emerging markets. Two firms are analysed: CVC Capital, which seeks to invest in China and Vodafone, which seeks to make further investment in India and Egypt (Chu 2014; Zakeria 2014). Both firms are headquartered in the UK. This essay argues that the size of the market and the economic growth prospects of the host country is the most important factor that influences decisions to invest in emerging markets Implications for international firms doing business within an emerging market The concept of emerging markets was first used in the 1980s by the World Bank in reference to marketing activities in countries regarded as operating within the transitional phases, between developed and developing states (Ganster 2001).
Emerging markets are nations that aim to structure their economics with the view of making them relate to market-oriented globalisation, offer trade opportunities, transfer of technology and foreign direct investments using open-door policy.
Glesem et al. (199) explained that such countries maintain large resource-base and populations. Additionally, they seek to abandon traditional-state interventionist policies in pursuit of having sustainable economic growth.
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