globalEDGE International Business Blog

China has just recently launched its brand new Growth Enterprise Market, a Nasdaq-style stock market that has been over 10 years in the making. Twenty eight small- and medium-sized companies will be debuting on the Gem as it is called, made to attract financing of new high growth industries. These industries include software companies, pharmaceutical firms and creative industries. But investing in these companies will be risky business, since there will less than 30 companies to begin with. 

The stock exchange will most likely go through some rough periods given its size. It will be very open to volatility. It will be interesting to see with the cost of equity being so high, if the higher return expected will be given. It may take a while for this exchange to compete with the markets in New York or Hong Kong, but it has the potential. Right now there are very few opportunities and options to invest in China, so the future is there. If you are willing to take the plunge and invest, you may be rewarded very highly. 

While more developed countries have been faced with huge financial problems and equities have advanced just under 50% this year, markets in developing countries such as China and India are trading at 52-week highs. Furthermore, emerging markets account for about 50% of world GDP. It seems likely that they will be the source of global growth over the next few years, seeing that developed countries are spending resources in reducing debt and rebuilding banking systems.

The following two videos present advice that can be helpful to investors worldwide.

First, the danger of asset bubbles and how to spot them:

The U.S. commercial service specializes in helping U.S. businesses expand internationally. Recently, they posted three interviews on their website which focus on business opportunities in India. If you are even considering India as a potential market, you should take a minute to learn from the experiences of people in these interviews.

The international consulting firm Mercer recently released its list of the World’s Most Expensive Cities to Live. The implications of the study on global business are substantial. With all of the outsourcing that has taken place, companies will be much more guarded in where they move their businesses to. Many times, companies provide compensation packages to employees living abroad, and it will cost them considerably more to help support employees abroad in cities which are expensive to live in.

Although there may be a demand for their business, companies will likely choose cities which are cheaper for their employees, which means they spend less on employee compensation and can gain more profits. What implications does the list have for you?
 

The Top 5:

Solutions to this economic mess may seem to necessitate complex plans, but a deceptively simple old visa program is starting to garner growing attention as a means to lift especially troubled areas of the U.S. out of their economic woes.

It works like this: immigrants invest $500,000 in a new or struggling business via an approved regional center, get green cards for their families, don't have to manage day-to-day issues with the businesses, and get to pull their money out after 2 years if they pass an audit. Sounds good?

When the fast money round in the popular game show Family Feud has globalization as one of the questions, “the survey says” …China! But can this help Latin America win the jackpot? That is an interesting question and here’s why…