Emerging markets are experiencing rapid growth driven by a rising middle class, presenting new opportunities for international businesses. However, these markets also carry risks including non-payment from customers, political unrest, currency controls, and lack of corporate information. The document provides strategies for businesses to manage risks in emerging markets such as using credit insurance, factoring accounts receivable, documenting all transactions, and including finance teams when expanding sales internationally.

1. EMERGING MARKETS GROWTH ON THE RISE
GROWING MIDDLE CLASS IN EMERGING
MARKETS BRINGS NEW OPPORTUNITIES
WHAT ARE THE RISKS
IN EMERGING MARKETS?
Trends, Risk Factors & Solutions
MAXIMIZE INTERNATIONAL GROWTH
OPPORTUNITIES
Emergence of middle class =
rapid urbanization =large
infrastructure projects
Consumer power =retail growth
=massive distribution network and
new supply chain opportunities
Social conscience =
Environmental management
Do a proper credit check
Use Political Risk
Insurance to protect
your foreign assets
Consider factoring as part
of your credit strategy
Document, document,
document
Non-
payment
from
customers
Political
unrest
Sanctions Currency
controls
Build relationships
with new customers
Use credit
insurance to protect
your cash flow
Have a well-defined
overdue and account
collection process
• Finding corporate information
for emerging markets is trickier
• EDC Opinion Report: includes
opinion on whether buyer is
insurable
• D&B Business Information Report:
legal issues, credit and financial
information and more
• Protect your assets from
expropriation, breach
of contract, political
violence, and more
• Protect your cash flow
from imposed currency
restrictions
Factoring companies will
buy your accounts receivable,
often on a non-recourse basis,
leveraging your credit risk
into cash
Your chances of collecting
on a delinquent account are
highest in the first 90 days
5% of EDC claims start
from a dispute
The first time you sell to
a customer, use a “master
agreement” rather than just
a purchase order
Include your Finance
Services team as well
as your Sales team
Be sure you get paid through
a variety of flexible options at edc.ca
Visit the new Receivable
Insurance Association of Canada at
receivablesinsurancecanada.com
7 WAYS TO MANAGE RISK FOR A GROWTH STRATEGY
›Learn more about growing while managing risks at edc.ca/risk
ASIA
1/3 of world’s GDP
AFRICA
home to some of the
world’s fastest growing
economies
SOUTH
AMERICA
emergence of middle-
class buying power
Many experts are forecasting the end
of the global recession and a promising period of new growth.
Get your company ready to take on international opportunities by knowing
how to manage the risks and obstacles to success.
1 2
34
5 6 7
India
plans to
spend $1 T
China plans
to spend
$300 M
endless
global
impact