Press Release

Managing Director Alex Gorbansky discusses the F-7 report on CNBC's Closing Bell

Washington, DC, – (BUSINESS WIRE) – September 11, 2007 – In Frontier Strategy Group’s 2007-2008 Emerging Markets Growth Survey titled “Shifting from the BRICs to the Future 7 (F-7): The Seven Markets That Will Drive Corporate Profit Growth in 2008 and Beyond”, senior executives from Asia-Pacific, Latin America and EMEA identified Indonesia, inland Brazil, inland China, Mexico, the Philippines, Turkey and Vietnam as the seven markets where success is critical if they are to meet corporate growth expectations in 2008 and beyond, as competition increases in the BRIC markets—coastal Brazil , Russia, urban India, and coastal China.

Commenting on the report during its release on CNBC’s Closing Bell, FSG Managing Director Alex Gorbansky noted that “The F-7 markets are an opportunity bigger than China. They represent 20% of global population and 12% of GDP, enjoy favorable geographic positioning and are open to foreign investment. To generate outsized returns relative to their competitors, companies are taking aim at these markets, particularly as the BRICs mature and become more competitive.”

The report, based on a survey of over 100 senior executives from multinational Fortune 500 and FTSE 100 companies from major global industries, details the following findings:

Executives view accessing and building competitive advantage in new markets as the critical success factor for multinationals in emerging markets. 44% of executives cited accessing new opportunities in emerging markets as the top factor for company success, easily outpacing the second most cited factor, recruiting and retaining local talent (32%). “Executives responsible for emerging market growth are realizing that they will not be able to meet and exceed lofty corporate earnings growth expectations unless they expand outside of the core BRIC markets, where current rates of earnings growth are likely to level off, ” said Gorbansky.
When multinational executives ranked 25 non-BRIC emerging markets based on attractiveness of the investment environment and size of the market opportunity, the F-7 economies were head-and-shoulders above the rest. On a 10-point scale, each of the F-7 scored at least a 7.0, while no other economy scored higher than a 6.3. Executives cited the F-7 markets’ large populations and economies, rapid demographic and economic growth trajectories, and receptivity to foreign investment as the key factors that distinguished them from other markets.
Despite overall optimism about the future of emerging economies, executives identified a few specific threats that could derail growth. While the threats cited varied by region, US economic decline, uncertainty over the quality of host country governance, and the future of commodity prices were common concerns across regions. Nearly 80% of the executives we surveyed viewed these risks as “unlikely” or “very unlikely” to prevent expansion into new markets.

Mr. Gorbansky’s appearance on CNBC can be seen at:

http://www.cnbc.com/id/15840232

About the Report

Comments on and coverage of the report can be found at:

http://blogs.wsj.com/economics/2007/09/11

About Alex Gorbansky

Alex Gorbansky is a Managing Director at Frontier Strategy Group and heads the Africa Mining & Energy practice at the Frontier Strategy Group.

About Frontier Strategy Group

Frontier Strategy Group (FSG) is a provider of membership based Councils supporting senior executives in emerging markets. Our exclusive Councils enable executives bearing similar corporate responsibilities to share insights and experiences with their peers in order to address their most pressing challenges.

The firm is based in Washington, DC, and has offices in Cambridge, Los Angeles, and New York.
www.frontierstrategygroup.com

Media Contact:
Alexis Horowitz-Burdick: +1 202 280 2060 or via email at: ahorowitz-burdick@frontierstrategygroup.com