Guest editorial

Citation

McManus, J. and Floyd, D. (2009), "Guest editorial", International Journal of Emerging Markets, Vol. 4 No. 4. https://doi.org/10.1108/ijoem.2009.30104daa.001

Guest editorial

Article Type: Guest editorial From: International Journal of Emerging Markets, Volume 4, Issue 4

About the Guest Editors

John McManusSenior Research Fellow at the University of Lincoln and Professor of Management at the Rushmore Business School.

David FloydSenior Lecturer in International Business at Lincoln University. He has published extensively on foreign direct investment, and has also worked on consultancy projects for the DTI and United Nations and he is also a guest speaker at the University of Hong Kong.

Welcome to Vol. 4, Issue 4 of International Journal of Emerging Markets. This special issue of Vol. 4 takes as its theme Changing patterns of global growth. The main motivation behind this special issue was to establish whether emerging markets were able to maintain substantial growth in view of the recent global financial crisis.

The papers presented in this issue build on themes from previous issues and offer the reader an eclectic feast of information. The paper on financial contagion helps shows us that all countries have been influenced by the crisis no matter what their history of high growth. Usually, emerging markets may experience less of a slow down to developed economies since they are still in the process of catch up and will therefore advance quicker.

The paper by David Gray demonstrates that the emerging markets in Eastern Europe cannot escape the slowdown and despite not being in the Euro Zone have had their currencies greatly influenced. The results here support the view also that some Eastern economies are now doing worse than Western European economies in terms of 2009 growth predictions.

Moving on, the paper by Raul Gouvea and Sul Kassicieh about the sinicization of Latin America economies helps to establish the problems occurring in other emerging markets besides China and India and shows the truly global outlook of this special issue. Latin America is also suffering from the financial crisis and is offered little support compared with Eastern European countries that can draw on European Union (EU) funds to some extent to lesson the impact of the crisis. It is argued that Brazil is set to recover much faster than Eastern European economies in 2010. This is due to the fact there is less focus on social policy in Brazil compared with the EU as well as there being less of a need to cope with directives and membership requirements. Economies like Brazil face higher levels of interest rates and inflation. In this respect the discipline imposed by EU membership may help countries with regards to inflation rates. China and India seem to be the exceptions for emerging markets and are seeing positive growth in 2009 despite the global slowdown. All countries are experiencing increasing job losses and the threat of major closures.

The contribution by David Floyd and John McManus helps to clarify the limited role of national government in coping with the crisis. Often countries are now following similar economic policies due to the globalisation process. Successful recovery from the crisis will depend on coordinated global action as was shown at the 2009 G20 summit in London. The importance of membership of the World Trade Organisation has been crucial in establishing more global coordination and inflation has proved to be less of a global problem so far than in previous recessions. This theme is also debated in Peter Enderwick's paper which looks at the contribution of emerging markets to strategic adoption. Peter Enderwick argues that the most important changes that have occurred in the world economy include industry deregulation, external liberalisation, pervasive technological change, the continuing globalisation of economic activity, and increased competition.

The paper by M. Shabri Abd Majid and Salina Hj Kassim demonstrates the effects of the crisis are not just only confined to growth and exchange rates but also global stock markets particularly equity markets. It could be argued that there is a shift-taking place in global growth patterns not seen since the 1930s. Much of this shift has been towards the new emerging markets of China and India which have resisted the global trend and managed to achieve growth in a post credit crunch economy. Other emerging markets including Brazil and Eastern Europe have in some cases faired worse than developed economies in 2009. Further substantial changes in policy may be required to match these higher levels of growth in the next five years.

Finally, Alex Kouznetsov's study examines entry modes employed by foreign multinational manufacturing enterprises (MMEs) entering Russia. It is designed to discover how multinational firm decision-makers perceive country conditions in one of the least stable world economies, and to provide the basis for further studies of companies that locate manufacturing in such volatile markets. The author concludes that favourable economic conditions and large MMEs' internal factors are the decisive issues.

John McManus, David FloydGuest Editors