The survey also shows that businesses in emerging markets fear their growth prospects are hampered by poor access to finance and a lack of highly-skilled workers to a much larger extent than their counterparts in more mature economies. On a positive note, of the three countries on the African continent which are ranked in the emerging economies index, namely South Africa, Egypt and Nigeria, South Africa is the highest ranked. Sentiment of optimism An “optimism balance” is the proportion of businesses reporting they are optimistic less those reporting they are pessimistic. Grant Thornton’s index measures investment opportunities in 27 emerging economies, taking account of factors such as size, wealth, involvement in world trade, growth potential, and levels of human development. It forms part of the global business advisory firms’ International Business Report for 2010. “These nations also tend to recover more quickly, with growth rates over the next two years forecast to be double that of the more mature economies.” The top five emerging nations maintained the same rankings since in 2008. China leads the way, thanks to its huge consumer market, increasingly open economy and trade growth, followed by the other developing Asian powerhouse, India. SAinfo reporterWould you like to use this article in your publication or on your website? See: Using SAinfo material “The importance of the emerging markets to the world economy has been brought into sharper focus as the world emerges from the recession,” said Brehm. “The International Business Report indicates to us that the emerging economies have been less severely hit by the recession than developed countries. Russia, thanks to its wealth of natural resources, is third, followed by the two largest economies in Latin America – Mexico and Brazil. “Indeed, these markets and their businesses are developing so rapidly and powerfully that not investing in them represents a risk to long term profitability. Emerging markets are certainly the future powerhouses of the world economy,” Brehm said. SA highest ranked in Africa The index indicates that a sentiment of optimism abounds in the emerging markets worldwide. An optimism balance of +57% of privately held businesses in 14 of the world’s leading emerging markets indicated that they were optimistic about the prospects for their country’s economy in the year ahead. South African business owners indicated an optimism balance of +60%, well in line with the emerging market sentiment. At the same time, a balance of just +2% of businesses in mature economies indicated that they were optimistic. The global average was +24%. At an individual country level, emerging economies occupy four of the top five places in terms of optimism for the year ahead – namely Chile (+85%), India (+84%), Vietnam (+72%) and Brazil (+71%). The only developed country in the top five is Australia (+79%). “South Africa’s economy is well-developed in many ways, with an abundance of natural resources and robust financial, legal, communications and transport sectors, but it remains polarised, with an unemployment rate touching 25%,” said Brehm. 28 June 2010 South Africa slipped from 13th to 15th place compared to 2008, when the survey was last conducted, with Chile and Iran overtaking it. Emerging market resilience “South African private business owners cite the lack of availability of a skilled workforce as the greatest constraint to business growth (34%),” explained Brehm. “The emerging markets average for this factor is only 25%, indicating the lack of skills in South Africa as a major concern for business.” “A big concern is the large percentage drop in South Africa’s ranking since 2008,” Grant Thornton South Africa chairman Leonard Brehm said in a statement this month. “Other than Nigeria, which recorded a 20% drop since 2008, South Africa showed the second-largest drop, with a 10% decline in the country’s 2010 score.” With emerging market optimism running high, South Africa will need to “keep its eye on the ball” if it wants to improve its ranking in the emerging markets opportunity index, says consultancy Grant Thornton, after the country slipped from 13th to 15th place – while remaining the highest-ranked African country on the index.