The global credit crisis was one of the longest, deepest, and most painful in history. Wall Street icons like Lehman Bros, toppled and required government bailouts. This shocked the global economy and resulted in deep economic recession and even a deeper crisis of confidence. The crisis revealed a new world order in terms of economic and market dynamics. Emerging markets economies came as a rescue being a powerful, essential, and permanent contributors to global economic growth and sustainability. (Forbes) US customers account for 25% of the world's spending, but that number is shrinking. Brazil, Russia, India and China now outspend their counterparts in the US. The drift will transform the global economy in next couple of decades, Asia is one of the major contributor as it is home to nearly half of the world's population. (Forbes).
Turkey was one of the many countries who experienced hyperinflation and currency collapse, Turkey's middle class have tended to hold at least part of their savings in hard currency. But unlike in Russia, Turkish investor's inclination to save in dollars proved helpful to companies and the central bank. Many Turks, rather than just accumulating dollars, have evolved into savvy players of exchange rate swings and often use sharp falls to sell their dollars and buy back the local currency. (Sujata Rao, 2013). Turkey an emerging economy may consider joining the Shanghai Cooperation Organization, which includes countries such as China and Russia, instead. "The economic powers of the world are shifting from west to east, and Turkey is one of these growth economies," remarked the prime minister. Turkey's manufacturing sector, such as the automotive industry, goods including refrigerators and washing machines, and glass makers, is one of the strong competing markets in Global economy. (Frank Holmes, 2013).
Question 1: What must an Emerging Market country do to create a business environment comparable to that of a developed country? Discuss the nature and differences in political economy between emerging markets and developed countries.