Marketing in Third world nations – Opportunities and Challenges
Anthony O’Sullivan, Marie-Estelle Rey and Jorge Galvez Mendez, 2011 discusses the opportunities and challenges of marketing in the third world nations. The revolutions and protests to get economic and political freedom that arise in Egypt and Tunisia spread across the region to Libya and other nations. This protests ended the regime of Muammar Qadaffi of Libya, Hosni Mubarak of Egypt and Ben Ali of Tunisia etc. These protests led to the opportunities in political and economic system in these regions. The challenges faced by the third world nations according to the OECD report include high unemployment levels, export fluctuation, increasing inflation, lack of entrepreneurship, deficits in current account and GDP etc. The following statistics by IMF, World Bank and OECD stand as evidence for these challenges in the third world nations.
Figure 2.1 - Rate of Unemployment in third world nations
Source: Klapper, L. and I. Love. 2010
The above statistic reveals that the unemployment rate in third world nations including Egypt and Libya is increasing at a fast rate. This poses a big challenge for the thord world nations.
Figure 2.2 - Inflation rate in third world nations
Source: IMF, 2011, OPEC, 2010
The inflation rate of the third world nations including Egypt and Libya has been increasing rapidly after the economic recession in 2008. This indicates that the prices of the essential commodities in the third world nations have increased to a great extent. The banking industry in these nations is not regulated in a proper manner to control the inflation rate. This is a major challenge for the third world nations.
Figure 2.3 - GDP growth rate in third world nations
Source: IMF, 2011 and OECD, 2011
The GDP growth rate of third world nations experienced a huge slump in the economic recession of 2008 and started recovering rapidly as seen above. The GDP of third world nations is mainly fuelled by the export growth and mainly due to the export of the oil reserves. This indicates a huge opportunity for the third world nations. This fact is revealed in the below figure 2.4
Figure 2.4 - Exports in third world nations
Source: IMF, 2011, IEA, 2010
Oil is the major strength and opportunity of these third world nations. The region has a rich natural reserve of crude oil. The export of Oil resources gives a major opportunity for third world nations like Egypt, Syria and Libya etc. to engage in foreign exchange. The above figure gives a clear description of the role of exports in the economic development of third world nations.
Figure 2.5 - FDI Inflows in the third world nations
The foreign direct investment is increasing on a rapid basis from Asia and China in the third world nations. Most of the FDI is in the energy sector and infrastructure development of these nations. This is an encouraging sign and an indication of positive growth offering...