Rapid urbanisation is propelling growth across emerging markets and shifting the world’s economic balance toward the east and south, according to global consulting firm McKinsey. By 2025, it will create a 'consumer class' with more than four billion people, up from a billion in 1990.
Nearly half will live in the emerging world’s cities, which are set to inject almost $25 trillion into the global economy. Yet business leaders mostly ignore them, McKinsey said. “We found that fewer than one in five executives makes location decisions at the city (rather than country) level.
“Few executives expected this approach to change over the next five years, and more than 60 percent regarded cities as an irrelevant unit of strategic planning. This is a very significant shot in the arm for a global economy that continues to suffer from pockets of acute fragility.”
According to McKinsey, shifting investment away from established markets to more promising areas will be the key challenge in that regard. The full report is available online.