Executive Briefings

How Can Business Leaders Navigate Shifting Economic Relationships?

During the mid-2000s, when emerging markets were growing at breakneck speed, the cavernous gap separating industrial and developing economies began to close. This convergence took place against a backdrop of economic liberalization, built on the idea that the financial systems of all nations would dovetail. That period is now over.

How Can Business Leaders Navigate Shifting Economic Relationships?

Emerging nations are no longer growing as rapidly as they were, particularly in comparison with developed economies; further, the fissures among different systems have become more evident. In PwC’s 19th Annual Global CEO Survey, only 35 percent of the corporate leaders who responded said they believe the world is moving toward greater economic union. Instead, 59 percent of these chief executives believe that multiple models will coexist and compete. Consider, for example, how differently government and business investment is conducted in the United States, China, India, Japan and the European Union. These nations and regions operate with fundamentally different assumptions about the way an economy should be organized. The tension among these assumptions is growing, not diminishing.

In short, a new global economic order is now emerging to replace the one that has existed since the end of World War II. For the foreseeable future, the global economy will be defined by a complex and continuously shifting set of economic relationships. They will be increasingly interconnected, to be sure, but with ever-changing rules for conducting business across borders.

As a business leader, how can you manage this complexity?

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Emerging nations are no longer growing as rapidly as they were, particularly in comparison with developed economies; further, the fissures among different systems have become more evident. In PwC’s 19th Annual Global CEO Survey, only 35 percent of the corporate leaders who responded said they believe the world is moving toward greater economic union. Instead, 59 percent of these chief executives believe that multiple models will coexist and compete. Consider, for example, how differently government and business investment is conducted in the United States, China, India, Japan and the European Union. These nations and regions operate with fundamentally different assumptions about the way an economy should be organized. The tension among these assumptions is growing, not diminishing.

In short, a new global economic order is now emerging to replace the one that has existed since the end of World War II. For the foreseeable future, the global economy will be defined by a complex and continuously shifting set of economic relationships. They will be increasingly interconnected, to be sure, but with ever-changing rules for conducting business across borders.

As a business leader, how can you manage this complexity?

Read Full Article

How Can Business Leaders Navigate Shifting Economic Relationships?