Competitive horizon

Citation

(2011), "Competitive horizon", Strategic Direction, Vol. 27 No. 5. https://doi.org/10.1108/sd.2011.05627eab.001

Competitive horizon

Article Type: Competitive horizon From: Strategic Direction, Volume 27, Issue 5

Change forecast in economic world order

A report published by the Tehran Times (www.tehrantimes.com) claims that China is on course to replace the USA as the world’s biggest economy by 2018. It is also predicted that by two years later the seven biggest emerging economies will have a higher combined gross domestic product (GDP) than their G7 counterparts. Growth in the E7 nations will be lead by China and India and the report identifies Brazil, Russia, Mexico, Indonesia and Turkey as the others. These predictions use purchasing power parity but this shift in economic power is forecast to occur around 2032 when measuring GDP by market exchange rates. Looking further ahead, the report anticipates that India will also have overtaken the USA by 2050 with Brazil and Japan completing the top five. By that time, the UK will struggle to retain its position as one of the ten leading economies in the world. The impact of China’s one child policy on its workforce means that the country’s economy is expected to progressively slow beyond 2020. However, rising quality of its exports will ensure China’s status remains an export superpower.

South Africa to go digital by 2013

Government ministers in South Africa have put back the deadline for completing the migration from analogue to digital television to December 2013. Globally, the switch is set to be completed by 2015 so changing from the original November 2011 date still enables the country to meet this deadline. For the switchover, South Africa will adopt the digital television standard DVB-T2 that offers greater efficiency in its use of spectrum. When the change has been completed, people intending to retain analogue TVs will require a set top box to convert the signal. Some government aid will be available to help with purchasing the boxes but only for the very poor. According to a report published by www.allafrica.com, the move could help revive electronics manufacturing in South Africa and a demand for set top boxes from other African nations. In addition to this potential impact on exports, the report points out that use of DVB-T2 will give viewers access to more channels and could have positive implications for production and creative industries as a result.

Outdoor advertising to rise in Russia

A report published by www.rt.com predicts that Russia will see strong growth in outdoor advertising this year. Following two decades of significant development, the industry experienced a 40 percent decline during the recent economic downturn. This occurred mainly because of cutbacks made by small and medium sized businesses. However, along with demand from new larger organizations, smaller operators are beginning to return and 2011 growth is expected to climb back to pre-crisis levels. Small companies are attracted to the cost effectiveness of billboard images, which are cheaper and easier to produce than television commercials. And according to some industry insiders, firms using outdoor advertisements can reach around 60 percent of consumers with high spending power. Companies that advertise in and around Moscow will also benefit when plans to strengthen regulations to tackle the problem of illegal advertisers take effect.

Green packaging sector in the USA set for modest growth

Demand for green packaging in the US market is expected to increase annually by 3.9 percent until 2014, an industry report from the Freedonia Group claims. By that time, the sector will be worth $41.7 billion each year. Growth will be strongest in degradable packaging and plastic recycled packing, although it is believed that paperboard and metal packaging already having high recycled content will limit overall industry expansion. Price competitiveness, capacity increases and growing interest in environmentally-friendly outputs are cited as key reasons for the anticipated rise in demand for degradable packaging that could be as much as 13.6 percent each year. Performance enhancements will also help, although competition from non-biodegradable alternatives and a poor recycling infrastructure in the US are potential barriers to growth. According to www.foodnavigator.com, demand for packaging that contains recycled content will increase annually by 3.6 percent and account for 27 percent of total packaging. Greener practices from firms and improved collection and processing will be key growth drivers. A manufacturing upsurge is expected to boost reusable packaging to the extent that growth of 5 percent per year is forecast.