Thursday, 30 May 2013
Chart of the Day - Emerging Markets now contribute 33% of European companies' revenues
"When you cease to make a contribution, you begin to die."- Eleanor Roosevelt
The rising importance of Emerging Markets in European companies' revenue is now doubt an important factor to take into account in this ever growing globalised and correlated world we think.
The chart below comes from Morgan Stanley's recent "Global Exposure Guide 2013" published on the 28th of May:
"•European companies continue to diversify their revenue exposure away from Developed Europe.
As shown in Exhibit 2, the proportion of European revenues generated within developed Europe has been falling relatively consistently since we published our first Global Exposure Guide in 1997, when developed Europe accounted for 71% of all European revenues. Our analysis shows that this figure will have fallen to just 46% in 2013."
• Emerging Markets account for 33% of total revenues.
Reflecting both the relative growth rates in the respective regions and corporate expansion within the region, the revenue exposure in EM is now over two-thirds the level of developed Europe. As shown in Exhibit 1, we expect revenues from emerging markets now to make up 33% of European companies’ revenues. Exhibit 3 plots the rapid progression of EM since 1997 from just 12% of European revenues – an increase of 2.8 times in 16 years.
• US revenue exposure is expected to rise to nearly 16% in 2013
We expect the share of European companies’ revenues derived from North America (US+Canada) to return to2005 levels of 18%, as shown in Exhibit 3.
US exposure will have risen to nearly 16% this year, our analysis suggests, the highest since our data start in 2007. However, Emerging Markets still account for over double the share of revenues from the US." - source Morgan Stanley
Welcome to a higher correlated world!
"I am disillusioned enough to know that no man's opinion on any subject is worth a damn unless backed up with enough genuine information to make him really know what he's talking about."
- H. P. Lovecraft