Emerging Markets Reshaping Globalization annual conference recap

By: Eudes Lopes, MA ’16 & PhD candidate (A&S), EMI contributor
Conference attendees

2018 annual Emerging Markets Institute Conference. Photo credit: Lourdes Casanova

The 2018 Emerging Markets Institute (EMI) Conference convened on Nov. 9, 2018, during a moment of change in international affairs and global commerce and at a time when emerging markets have become the new champions of globalization. The rise of protectionism and the eruption of trade wars between the world’s two largest economies introduced unique challenges to the international economic system — a subject that had been debated at EMI’s 2017 conference. A year later, it was instructive to observe the major stakeholders reaffirm the critical role emerging markets are playing in setting the terms for this new era.

The title of the conference was therefore apt: “Emerging Markets Reshaping Globalization.” In their opening remarks, Andrew Karolyi, deputy dean and college dean for academic affairs at the Cornell SC Johnson College of Business, and Mark Nelson, Anne and Elmer Linseth Dean of the Samuel Curtis Johnson Graduate School of Management, reflected on the salience of this thesis as it becomes increasingly clear that emerging markets are among the most significant protagonists of the resistance against inward-looking trends the world over. Both Karolyi and Nelson stressed how vital a forum such as this one is at such a pivotal juncture in history.

Conference attendees
Emerging Markets Institute Advisory Council members and students

The EMI Report: Emerging Multinationals, mainly Chinese, continue to grow

Conference organizers Lourdes Casanova, senior lecturer and director of the Emerging Markets Institute (EMI), and Anne Miroux, EMI faculty fellow, took the floor to launch the report they co-authored, Emerging Market Multinationals Report (EMI) 2018: Emerging Markets Reshaping Globalization. For this report, Casanova and Miroux  drew on extensive collaborations with Lorenzo Pavone, director of the Emerging Market Network at the OECD Development Center, and Fernanda Ribeiro Cahen, assistant professor of management at FEA (School of Economics, Business and Accounting) at the University of São Paulo, among others. Casanova and Miroux provided an overview of the major takeaways from the report: most notably, the recent penetration of emerging multinational companies (eMNCs) in competitiveness by brand (not just price), as well as the realignment of supply chains across the emerging market landscape in the wake of the U.S.-China trade war.

The panel that followed made way for further reflection on eMNCs against this larger backdrop laid out by Casanova and Miroux. The participants included Roberto Cañizares ’71, MBA ’74, retired president of MSA International; Peter Cornelius, managing director of AlpInvest; Demir Sabanci, MBA ’99, president and chairman of Sedes Holdings; and Conrad Saldanha, managing director at Neuberger Berman.

The resounding consensus was that eMNCs represent many of the most prized equity investment opportunities in the international market. While they advised caution, prudence, and due diligence in light of political risks, corruption liabilities, and currency instability, they also stressed that the most innovative companies are no longer tethered to any particular market ecosystem. Thus, according to them, it would behoove investors to get ahead of market developments (near and far) and be prepared to challenge previous assumptions along the way.

The country panels: Brazil, Africa, Mexico, China and India

Next, the conference shifted its focus to market and region-specific discussions. Three of these included full panels focused Brazil, Mexico, and India; one included a special address about Africa; and the last was a one-on-one interview focused on China.

Brazil highlights

The discussion of the Brazilian market was moderated by Sam Sotoodeh, president of Acquisition Group, and included panelists Roberto Ardenghy, deputy consul general, Economic and Commercial Affairs, Consulate General of Brazil in New York, and Sergio Rodriguez Costa, managing director, Investe São Paulo. The overwhelming message was one of reform. The participants referenced the change in government, with the dawn of the Bolsonaro era on the horizon, which they suggested would bring about attractive market conditions for investors, especially for low-risk/high yield foreign-direct investment.

Mexico highlights

The panel on the Mexican market, however, was more cautious about its optimism. In Latin America’s second largest economy, it was Andrés Manuel López Obrador, commonly referred to by his initials, AMLO, who swept into power — a change in government that signaled a period of uncertainty for businesses, according to panel participant Timothy Heyman, president of Franklin Templeton Asset Management Mexico. The other panelists, Pablo Azcarraga, chairman of Posadas Group, and Alejandro Camino, chief marketing officer of Softtek, did not deny the challenges ahead but did not rule out the possibility of dialogue and compromise in the new era.

Rwanda highlights

The conference was then privileged to hear from Valentine Rugwabiza, Ambassador of Rwanda to the United Nations, who delivered the “Special Address from Africa.” Her message was frank: the international trade and monetary system is under severe strain and the political risks are mounting. She shared with the audience the unique vantage point from which she is tracking world economic and political developments, in response to which she issued a warning against complacency. But her remarks also included a note of optimism for the role she observes emerging markets (especially China) playing in fighting to preserve the rules that have undergirded the international economic order. Ultimately, she suggested that Africa’s relevance in this dynamic is self-evident in its scale and possibilities, but that it is up to the region to rise to the occasion at every step.

China highlights

On the other end of the lunch and networking break, the conference was honored to host a most timely discussion with Dean Karolyi and Yuqiang Xiao, chairman of the US Management Committee at the Industrial and Commercial Bank of China (ICBC), about China’s growing position as a global power. The exchange touched on China’s strategy for finding its place in the world economy at this unprecedented moment in its history. Xiao stressed the significance of innovation for China’s remarkable ascent, and made clear that the country is expected to transform its business practices, including in the financial sector, which will be a priority in the years ahead. Xiao emphasized the importance of China’s investments in emerging markets in light of its distinctive expertise and sensibility to this economic landscape, of which it is a part.

India highlights

The conference neared to a close with a final market-specific panel on India. The participants included Dharmakirt Joshi, chief economist at CRISIL; Georges Ugeux, chairman and CEO of Galileo Global Advisors; and Ravi Ramamurti, director of the Center for Emerging Markets at Northeastern University. The panelists were not all in agreement on how to make sense of the crossroads India is currently experiencing. Ugeux contended that major structural reforms are of the utmost urgency at a time when natural resources are under strain and the regulatory status quo is no longer sustainable. Ramamurti and Joshi were less alarmist about the state of affairs in India, especially in light of the exceptional growth trajectory the country is on, which they projected would only persist in the near future.

What’s next?

In his closing remarks, Karolyi delivered a spirited celebration of what was achieved through this event. He expressed his appreciation for the participants and gave a glowing review of their observations. He saved his deepest gratitude for the conference organizers, especially Lourdes Casanova, whom he acknowledged to be the chief architect of the Emerging Market Institute’s fruitful incubation of ideas, insights, and future opportunities.

Save the Date for the 2019 Emerging Markets Institute Conference

The Emerging Markets Institute will continue this discussion at its 2019 conference, scheduled to be held on Friday, November 8, 2019.


Eudes Lopes

Eudes Lopes, MA ’16 & PhD candidate (A&S), EMI contributor

Eudes Lopes, MA ’16 (A&S) is PhD candidate in Cornell’s College of Arts and Sciences Department of Anthropology. His research examines how different currents of economic thought are contested on behalf of evolving state-market arrangements. Eudes holds a bachelor’s degree in anthropology from the Woodrow Wilson School of Public and International Affairs at Princeton University.

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