FDBusiness.com

Leading global law firm Linklaters has published its Index of emerging opportunities for the food and non-alcoholic beverage sector. This unique Index balances the competing factors of market potential and risk to assess each market’s overall opportunity.

Linklaters’ research reveals that emerging markets are essential to the success of global food and beverage companies. The ten fastest-growing food and non-alcoholic beverage markets in the next five years will be emerging markets and their potential outweighs their greater risk. Even when applied equally to developed markets, the Index gives six of the top ten places globally to emerging markets.

The report also notes that key emerging markets are less likely to be adversely affected by possible global economic crises, such as a Eurozone break-up or a hike in oil prices, than many food and beverage markets in the developed world.

Paul McNicholl, Linklaters’ Food and Beverage Global Co-head,London, says: “The Linklaters Emerging Opportunity Index demonstrates the continued resilience of emerging markets as drivers of growth for multi-national companies in the food and beverage sector. Whilst increased risk is often cited as a reason for reluctance to harness these opportunities, the Index clearly shows that, even on a risk-weighted basis, the emerging market growth opportunity cannot be ignored.”

He adds: “Our experience shows that companies can reduce their exposure to these risks by structuring their market entry strategy and by choosing their local partners carefully. Decades of experience working with companies investing into these markets enables Linklaters to help our clients balance this critical risk/reward trade-off.”

Stuart Bedford, Linklaters’ Food and Beverage Global Co-head,Singapore, comments: “We balanced both potential growth and risk factors in our research to assess the opportunities for multi-national companies in emerging markets. Whilst the ‘BRIC’ countries continue to lead the pack in terms of market potential, the Index confirms the growing importance of the  Indonesian and Mexican markets and shows that smaller markets, like Malaysia and South Africa, can provide attractive growth opportunities.”

Taking both opportunity and risk factors into consideration, the most attractive emerging markets for food and non-alcoholic beverage investment are China, India, Russia, Brazil, Indonesia, South Korea, Malaysia, Mexico, South Africa and Turkey.