Explain the impacts of emerging economies on UK firms

You must explain at least 2 impacts to gain full marks.

1 mark for each valid explanation

1 mark for a valid development

Model answer:

Emerging economies offer UK firms access to cheaper land, labour and materials, potentially reducing production costs for these companies (1). This cost reduction can be particularly beneficial for UK firms looking to establish manufacturing operations or source supplies from countries like India or Thailand (1).

However, emerging economies can also pose risks due to political instability, which can lead to sudden changes in government policies or trade restrictions, potentially disrupting UK firm’s opertaion in these markets (1).