Global warning
Find out more about the emerging economies.
Brazil
Population 183.9 million
GDP £318.9bn
GDP growth 4.9%
Foreign direct investment £9.6bn
Literacy rate 88.6%
Percentage of population using the internet 12
Percentage of population using mobile phones 26.4
Local knowledge
In population and land mass, Brazil is one of the world’s biggest countries. São Paolo, the world’s fourth largest city, has a population of 18.3 million and an economy bigger than Argentina’s. Some 80% of Brazilians live in urban areas, fuelling economic development and inequality: one in eight Brazilians lives on less than 53p a day.
Living conditions are improving. Infant mortality fell by over a third between 1990 and 2000. Over 87% of Brazilians have access to an improved water source and after an aggressive health campaign, deaths from HIV/AIDS have more than halved.
Studies suggest that Brazilian industry needs to more than double its spending on R&D to boost innovation.
Foreign investment in Brazil has doubled over the past 15 years and should grow as the power and banking sectors are privatised. But investment has fluctuated whenever crime or social unrest fill the headlines.
The Brazilian government has promoted design abroad since 1995. It has launched a design exhibition in São Paolo and wants to increase its cache of awards.
Strengths
Brazil has ample natural resources: water, coffee, soya beans, tobacco, meat, pulp, wood, steel, iron and aluminium are in abundance. And labour costs are low.
The 1990s saw a surge in foreign investment in manufacturing, especially in cars and consumer durables. This – and sluggish domestic demand – have made Brazil more export conscious. Trade with China is growing rapidly and the Brazilian company Embraer is one of the world’s largest aircraft manufacturers.
The 26 million Brazilians who access the internet spend over 19 hours online a month – more than Japanese users.
Brazil has been slammed for the deforestation of the Amazon rainforest but after new laws, shrinkage was down by a third in 2004/05.
Brazil are favourites to host the 2014 World Cup, which should be a massive boost to the nation’s infrastructure.
Uniquely, Brazil generates over 95% of its electricity from hydroelectric power, but coal reserves in the south and natural gas in the north must be tapped to spread the economic miracle nationwide.
Weaknesses
Scepticism. In international development circles they quip: “Brazil is an emerging country and always will be.”
In São Paolo a poor person might spend a fifth of their income on transport and take 2.5 hours getting to work.
Pollution. Up to 40,000 tonnes of household waste a day – 40% of the total – isn’t even collected in Brazil.
Brazil is the industrial power where the gap between rich and poor yawns widest – a burden on the public purse. In some states pensions account for half of public spending.
Brazilians use the term ‘custo Brazil’ for the red tape, fees, complex tax system and odd labour laws that ratchet up the cost of doing business.
Brazil is much less open to trade than China. The Chinese tradable goods sector is eight times as large as Brazil’s.
China
Population 1.3 billion
GDP £1 trillion
GDP growth 10.1%
Foreign direct investment £29bn
Literacy rate 90.9%
Percentage of population using the internet 7.25
Percentage of population using mobile phones 50
Local knowledge
China is the world’s fastest growing major economy – expanding by 11% in the first half of 2006.
China is spending £20.6bn on the 2008 Beijing Olympics, improving urban infrastructure, reducing traffic and creating thousands of jobs. Beijing’s economy is expected to grow by 20% by 2008.
China opened its first specialised design school only 23 years ago. Now it boasts more than 400. Beijing’s Tsinghua University is putting the finishing touches to a vast new design facility, while Guangzhou’s Academy of Fine Arts has the capacity for 3,000 industrial design students.
China’s massive capital investments mean that its factories are, on average, only 7.2 years old, compared to 16.9 in the US.
Chinese women are unlikely to invest in fake tans. A bronzed look suggests they work outdoors or have arrived from a farm. They prefer the lighter skin tone of professionals.
Strengths
China has a vast pool of cheap labour. Manufacturers know they must improve products to export them, so China is experiencing a design boom. Hundreds of design consultancies are springing up around the country.
By 2020 China intends to spend £59.1bn annually on R&D and invest 2.5% of GDP in science and technology.
Almost 20% of China’s exports are high-tech. Computers and office equipment are the biggest exports. Chinese computer maker Lenovo bought IBM’s PC division last year.
Direct foreign investment in China keeps growing. Fuelled by tax rebates to foreign investors, banking, tourism, health and education are being flooded with Western capital. Outsourced manufacturing is booming. Experts predict FDI will hit £31.7bn in a few years.
Weaknesses
Political uncertainty. How long can China offer economic but not political freedom?
Pollution is costing the country roughly 10% of its GDP. Economic development is being hindered by a shortage of resources, a fragile ecological balance and poverty in rural areas.
China has to manage growth carefully to ensure the economy doesn’t overheat and ramp up inflation.
China is in a race to get rich before it gets old. It’s estimated that by 2050 a third of the workforce – 432 million people – will be over 60.
Lack of protection of intellectual property deters many Western companies from doing business in China.
| Chinese manufacturer's share of the world market for: |
% |
| Televisions |
 38 |
| Computer monitor |
42 |
| Radios |
70 |
| Cameras |
50 |
| Air conditioners |
30 |
| Refrigerators |
16 |
India
Population 1.1 billion
GDP £365bn
GDP growth 6.9%
Foreign direct investment £2.7bn
Literacy rate 61.0%
Percentage of population using the internet 3.2
Percentage of population using mobile phones 2.5
Local knowledge
Services account for half of India’s economy, the second fastest growing in the world.
Google, IBM and Microsoft all have R&D centres in Bangalore or Hyderabad. IBM employs 39,000 staff in India.
Thirty-six million Indians are unemployed but there are more middle class people – 250 million – in India than in either the US or Europe.
Bollywood now makes more films than Hollywood.
Strengths
The IT sector is booming thanks to the rise and rise of outsourcing: India expects to control 51% of the outsourcing market for software and back-office services by 2008.
India’s vast amount of English-speaking scientific professionals is second only to the US. A young workforce means that by 2020 it will have one of the best dependency ratios – the balance between workers and dependents – of any major economy.
The new National Institute of Fashion Technology aims to promote Indian textiles and fashion goods worldwide.
Pharmaceutical companies are booming as a result of making generic drugs. The giant Ranbaxy generates 80% of its revenues from overseas.
Weaknesses
Corruption deters foreign investors. High trade tariffs, restrictive investment, planning and labour laws hinder economic development.
India’s government deficit was 7% of GDP in 2005.
The economic revolution may leave many behind – particularly those in rural populations and women. India’s boom, led by services and especially IT, relies on educated workers. Vocational training in basic trades such as plumbing is poor.
Basic education, healthcare and drinking water have been woefully managed.
Industrialisation has fuelled indiscriminate use of forests for energy, and drives towards food security have caused falling water tables and contamination by pesticides and fertilisers. High duties on new cars have kept older, dirtier vehicles on the road, which, coupled with India’s uncontrolled urbanisation, jeopardises air quality.
Russia
Population 143.8 million
GDP £307bn
GDP growth 7.1%
Foreign direct investment £6.6bn
Literacy rate 99.4%
Percentage of population using the internet 11.1
Percentage of population using mobile phones 24.9
Local knowledge
Russia is the world’s largest country, stretching over 11 time zones. It is the world’s leading producer of natural gas. Only Saudi Arabia pumps more oil. Rising oil prices have helped the country pay off most of its enormous debt.
One hundred Russians die every hour. The United Nations predicted that at this rate Russia’s population will shrink by a third by 2050. In 2004 there were more abortions (1.6 million) than births (1.5 million).
Economic reform has stalled and foreign direct investment remains comparatively low, though it is growing slowly.
Russia has 27 billionaires – more than any other country in the world apart from the US.
Strengths
High levels of education and science, engineering and mathematical expertise attracts American investors such as Xerox, IBM, and Intel. Russian engineers are renowned for their cross-disciplinary thinking.
One million Russians work in R&D, the largest number in the world. A lack of materials and equipment has forced researchers to think outside the box to solve problems.
Cheaper land and labour – and high growth rates – have attracted European investors.
Weaknesses
Russia has an uneven distribution of economic development. Technologically focused Moscow contributes to a third of the country’s GDP with a tenth of its population.
The economy relies on the export of oil, natural gas, metals and timber and could be easily affected by fluctuations in world prices.
The banking system is riddled with corruption despite attempts to normalise it. Russia struggles to shrug off the image that it is becoming a virtual autocracy and a haven for the world’s fastest growing mafia.
Russia faces massive environmental problems.
Singapore
Population 4.2 million
GDP £53.4bn
GDP growth 8.4%
Foreign direct investment £8.5bn
Literacy rate 92.5%
Percentage of population using the internet 57.1
Percentage of population using mobile phones 85.3
Local knowledge
Singapore has one of the highest per capita GDP in the world and the fourth largest foreign exchange trading centre after London, New York and Tokyo.
In 2005 the Economist ranked Singapore as top for standard of living in Asia and the 11th best in the world.
Agriculture accounts for none of Singapore’s GDP. Instead, industry accounts for 35% and services for 65%.
It has a huge potential market on its doorstep – 2.8 billion people live within a seven-hour flight of Singapore.
As part of a new ‘Design Singapore’ initiative, the government wants to make the city-state a ‘global design hub’, attracting design departments from multinationals and major design agencies to the island.
Strengths
Recognising a need to strengthen innovation, Singapore has invested £4bn in the Science & Technology Plan 2010, which will bring investments in R&D up to 3% of GDP, and pumped £528m into its arts infrastructure.
It has comparatively sophisticated industries in electronics, biotechnology and financial services.
More than 3,000 multinationals from the US, Japan and Europe invest in Singapore’s economy, which is the world’s most business-friendly, according to the World Bank.
Judged in terms of business tonnage, the port of Singapore is the busiest in the world.
Weaknesses
Shortage of labour in services and low-skilled jobs.
Singapore’s corruption-free polity comes at a price. Many see the island as an illiberal one-party state.
The island’s reliance on exports can be severely hit by global conditions. SARS panic disrupted trade and tourism. Bird flu may yet do the same.
Singaporeans have not always been encouraged to be flexible thinkers. Decreeing that they become creative overnight may simply not work.
South Korea
Population 48.1 million
GDP £358.9bn
GDP growth 4.6%
Foreign direct investment £4.3bn
Literacy rate 98%
Percentage of population using the internet 65.7
Percentage of population using mobile phones 70.1
Local knowledge
South Korea has the second highest number of broadband internet connections per capita in the world and boasts some of the most innovative online gaming companies.
Internationally recognised brands Samsung, LG, Hyundai and Daewoo originated from the Korean ‘chaebolî’– large family-run conglomerates that have restructured themselves for a global market.
South Korea has the lowest fertility rate in the world: 1.08. If that continues, there will be six million fewer Koreans by 2050.
The World Bank ranks South Korea fifth in its knowledge economy table, which takes account of education, innovation and information infrastructure.
Exports drive the South Korean economy – but the agricultural sector remains heavily protected until 2014.
Strengths
Economic growth has been spurred by the export of quality electronic equipment such as computer games, mobile phones and semiconductors.
South Korea has been promoting industrial design since 1993. By 2007 it hopes its design industry will compete with developed countries. Ironically, the expansion in design education – the number of graduates rose by 27% between 1998 and 2002 – has led some to worry the country may, in the near future, have too many designers.
The economy could expand further as the country increases trade with China. Government is committed to a free-trade agreement with America, despite domestic protests.
South Korea are bidding for the 2014 Winter Olympics. After attracting the Olympics in 1988 and the World Cup in 2002 (with Japan), the country is building its brand through high-profile events and investment.
Weaknesses
South Korea has restructured much of its economy since the economic crisis of 1997/98, but is yet to liberalise it fully.
By 2050 the workforce will be one of the oldest in the world, with over half of the population being over 50.
North Korea – with whom the South has yet to sign a peace treaty – almost certainly have a nuclear weapon, straining the republic’s relations with traditional ally America.
The opening up of the rice market to foreign competition could be socially and economically traumatic.
Protection of intellectual property remains an issue.
| Projected GDP in 2050 |
£bn |
| Brazil |
4,244.1 |
| China |
25,677.6 |
| India |
14,398.1 |
| Russia |
2,357.6 |
| UK |
2,678.7 |
| US |
19,912.6 |
Thailand
Population 63.7 million
GDP £85.4bn
GDP growth 6.2%
Foreign direct investment £740m
Literacy rate 96%
Percentage of population using the internet 11
Percentage of population using mobile phones 39.4
Local knowledge
Thailand is the only South East Asian country never to have been colonised by a European power.
Between 1983 and 1993, Thailand was the world’s second fastest growing economy behind China.
Thailand’s economy relies heavily on exports. High-tech exports are worth £18.5bn.
Donna Karan, Neiman Marcus, Gumps, Saks Fifth Avenue and Armani Casa have all sourced homeware accessories from Chiang Mai city. Princess Siriwanwaree Mahidol has had her fashion designs shown at Milan.
The 2006 coup was the nation’s 18th in 60 years.
Strengths
Relatively good governance despite the recent coup. Ousted prime minister Thaksin Shinawatra’s Keynesian-style ‘Thaksinomics’ helped stimulate the economy and run a balanced budget.
The government’s £26.4bn ‘Mega Projects’ public works scheme should improve the nation’s infrastructure.
After the 1997 Asian financial crisis, the government set up the Orwellian-sounding Office of Knowledge Management and Development to transform Thailand into a knowledge economy.
Bilateral trade agreements with China are increasing exports to that vast market.
Thailand has explicitly prioritised design, establishing a design centre and branding Bangkok a ‘Design City’.
Weaknesses
The tsunami cost Thailand over £37m and hit tourism – 5% of Thailand’s GDP – very hard. The number of passengers at Phuket Airport halved in 2005.
A shortfall of skilled engineers could hamper productivity and creativity.
Thailand should produce more high-tech items: a surge of machinery, vehicle and electronic equipment imports suggests it is falling behind.
While Bangkok has basked in economic growth, the north remains crippled by poverty, though the poverty headcount fell by 10% from 2000 to 2004.
Stories about sex tourism, drugs, coups and the long-running civil war in the south have marred Thailand’s image.
Turkey
Population 71.7 million
GDP £159.9bn
GDP growth 8.9%
Foreign direct investment £1.4bn
Literacy rate 97.7%
Percentage of population using the internet 14.3
Percentage of population using mobile phones 39.4
Local knowledge
Turkey’s traditionally volatile economy is enjoying sustained growth after market-oriented reforms lowered inflation. In 2005 GDP growth was 7.5%, a contrast to 2001 when the economy shrank by 7.5%.
Turkey is still trying to enter the EU. Cyprus and the country’s human rights record are barriers.
Last year Turkey established its first interior design award, the Design Turkey: Interior Design Award, to recognise excellence in design and architecture across public, private and civic projects.
Textiles account for £7.6bn of Turkey’s exports.
A law introduced in 2005 makes insulting a Turk, the Republic or the Turkish National Assembly a criminal offence punishable by three years in prison. The authorities are now reconsidering this law after an international outcry.
Strengths
The Turkish Research Area was recently established to promote R&D, increase the number of researchers by 42% to 40,000 by 2010, raise science and technology awareness and support development of a space programme. Government-allocated funding to R&D rose considerably in 2005 and 2006.
State-owned alcohol, tobacco and oil refining companies are all being privatised, after the successful sale of some banks.
Foreign direct investment is finally soaring: up to around £5bn in 2005 and 2006.
Turkey has a large, cheap and flexible workforce.
The public sector has, financially, begun to puts its house in order, with realistic budgeting and accounting.
Weaknesses
Turkey faces tough domestic issues, including the threat of Islamic fundamentalism within its borders and conflicts with Armenians and Kurds.
Weak enforcement of intellectual property rights has led Turkey to underperform in patent applications.
Unemployment is at 10%, though this may not reflect reality. Half of employment isn’t registered, narrowing the country’s tax base.
Businesses can pay over the odds for gas, electricity and telecoms services.
The agricultural sector is backward – employing 30% of the workforce and supplying only 12% of GDP – and needs reforming, though the political will to do so is lacking.
Vietnam
Population 82.2 million
GDP £27.7bn
GDP growth 8.4%
Foreign direct investment £1.3bn
Literacy rate 90.3%
Percentage of population using the internet 7.1
Percentage of population using mobile phones 3. 4
Local knowledge
Vietnam has proportionally fewer people living on less than $1 a day than India, China and the Philippines.
Exports soared by 25% in 2006. The country will soon export more rice than Thailand and already sells tea to India. That boom hasn’t been fuelled by high-tech exports. Yet.
Foreign investors include Intel, Hutchison Telecom, Nike and MTV. In 2005 foreign investment was 49% higher than in 2004 with shoes, textiles and electronics benefiting most.
There are probably 1,000 firms that specialise in publishing, advertising and design. A designer can expect to earn £158 a month. Foreign companies – especially in Japan – have begun to use Vietnamese design but many of Vietnam’s small and medium-sized businesses prefer a DIY approach to design. There has, as yet, been no massive investment in design centres.
Tourism is an emerging sector. The city of Da Nang is benefiting from a £422m input into its tourist business.
Strengths
Cheap – and comparatively well-educated – labour. Every year 1.5 million new job seekers enter the labour market. Vietnam also has a good location for the South East Asian market.
The Vietnam Communist Party’s new ruling triumvirate recognises that economic growth depends on the privatisation of thousands of state firms.
The population seems happy to accept the current regime as long as it delivers improved public services and economic prosperity.
The country already has a massive crude oil industry and is now investing in refining capacity.
Sustainability is already part of government policy. The state is on course to meet targets to increase forest cover by a third from 1998 to 2010.
Weaknesses
Even after reforms, complex rules and procedures for foreign investors deter many companies.
The government is racing to invest in improving its dodgy infrastructure – especially power stations, roads and railways – to maintain economic growth.
Investment could be delayed by any global recession and side effects of entry into the World Trade Organisation.
Industrial relations aren’t great – there was a wave of strikes earlier this year.
The government, despite making the right noises, hasn’t really tackled copyright piracy.
Article first published in Design Council Magazine, Issue 1, Winter 2006