Emerging markets experience rapid growth, reshaping themselves as they go and building new industries, cities, and customer bases in the process. These are the places where global momentum is concentrated. In growing markets including India's tech sector and Africa's digital advancements, you can transform your Business model, reroute the supply chain, and scale opportunities quickly – if you know how to seize them.

Below, we'll explain what defines an emerging market, where the fastest shifts are happening, and what the benefits and risks of doing business in an emerging market are.

What's in this article?

• What are emerging markets, and how are they defined?
  
• Which regions have the fastest economic growth?
  
• What are the biggest business opportunities in emerging markets?
  
• What are the advantages of doing business in emerging markets?
  
• What are the risks and challenges of entering emerging markets?
  

What are emerging markets, and how are they defined?

Emerging markets are economies in transition: they're moving from low or middle income to higher income or from local commerce to global trade. They haven't fully developed, but they're not stuck in early-stage growth, either. These are countries where industrialisation is underway, the middle class is expanding, and infrastructure is starting to catch up with demand.

What makes a market "emerging" isn't always clear. There's no official checklist. The International Monetary Fund (IMF), for instance, has a list of emerging markets. So do investment firms such as MSCI.

Most lists include these countries:

• Asia: China and India

• Latin America: Brazil and Mexico

• Europe: Poland and Turkey

• Africa: South Africa and Egypt

• Middle East: Saudi Arabia and the United Arab Emirates

These countries share several traits such as faster-than-average economic growth, increasing integration with global markets, an expanding customer base, and growing digital adoption. They typically have maturing infrastructure and functional – but still developing – financial systems. Some are economic powerhouses, while others are smaller countries that are growing quickly. This rapid, ongoing modernization and growth is part of what defines an emerging market.

The opposite of an emerging market is an "advanced economy," which is typically a high-income, stable market. The IMF classifies 41 countries and regions as advanced economies, including the US, Germany, and Japan. Every other country is somewhere on the developing spectrum, with emerging markets at the upper end.

Which regions have the fastest economic growth?

The fastest economic growth is happening outside the traditional power centres. Here are the regions that are experiencing it:

South and Southeast Asia

India is a standout, with 6.2% gross domestic product (GDP) growth in 2025. Vietnam, Indonesia, and the Philippines are seeing strong momentum, thanks to a mix of industrial expansion, digital infrastructure, and foreign investment. South and Southeast Asia as a whole is projected to have 5.7% and 4.1% GDP growth in 2025, respectively.

These markets benefit from large populations, rising incomes, and increasing demand for goods, services, and infrastructure. As the middle class expands, digital adoption is scaling with it.

Sub-Saharan and North Africa

Sub-Saharan Africa's GDP grew 3.8% in 2025, and North Africa's GDP grew 4.0%. Though growth varies widely in this region, countries such as Niger and Ivory Coast have seen GDP growth of over 6%. This growth is being driven by improved governance in many countries, tech adoption (especially mobile), and a young, urbanising population that's increasing demand quickly.

Central America

Though Central America faces structural economic challenges and political volatility in some countries, GDP has risen 3.8% in 2025. Countries such as Belize, Costa Rica, and Panama have lucrative tourism industries that contribute to overall market growth.

The reasons for growth vary – demographics, digital adoption, infrastructure investment – but the direction is consistent: global economic momentum is shifting away from the US and Europe toward fast-scaling regions in other parts of the world.

What are the biggest business opportunities in emerging markets?

Emerging markets are growing fast and creating new demand, which opens opportunities across sectors that are mature elsewhere. Here's where the biggest ones are appearing:

An expanding customer base

There are billions of people in emerging markets, with many moving into the middle class every year. That's changing the customer base fast. Half of all internet users worldwide in 2023 were in Asia, creating growing e-commerce demand for appliances, healthcare, financial services, and more. Mobile-first shopping is common. In places such as India and Southeast Asia, e-commerce adoption is largely happening on smartphones, not desktops.

If you're building a customer brand or offering services previously out of reach for these people, you will find room to grow.

Digital advancements

Many of these markets skipped legacy infrastructure and adopted mobile and digital-first models. Africa and Southeast Asia are global leaders in mobile payments and fintech adoption, respectively. Digital banks, super-apps, and digital wallets are reshaping access to finance in countries where traditional banking never had a wide reach.

Stripe helps global businesses enter these markets without the usual cross-border friction, letting them accept local payments and currencies without setting up shop locally. You can reach these customers with the right digital infrastructure and payment tools.

Infrastructure and urban growth

Cities in emerging markets are being built up quickly. That's driving demand for:

• Construction and materials

• Power and clean energy

• Public transport, logistics, and telecommunications

These markets are often building from scratch. That creates space for newer, more efficient tech from the start, especially green energy and smart infrastructure.

Natural resources

Many emerging economies are rich in resources such as oil, gas, copper, lithium, and arable land. These raw materials are necessary for energy, manufacturing, and food production.

• Countries such as Guyana are becoming major oil exporters.

• Senegal and Mozambique are developing natural gas hubs.

• Bolivia and Chile are central to the global lithium supply chain.

Businesses in energy, mining, and agricultural technology are setting up long-term operations and building adjacent industries around them.

Manufacturing and supply chain

Businesses are diversifying where they make products, and emerging markets are becoming new manufacturing hubs. Vietnam, Bangladesh, Mexico, and India offer alternatives to China for labour-intensive industries such as apparel, electronics, and auto parts. These regions offer competitive labour, growing industrial clusters, and improving logistics. Many businesses use them for production and regional distribution, tapping into local markets while selling globally.

Local improvement

There's also a surge of homegrown startups that solve regional challenges and have global potential. Fintech and agricultural tech businesses are building new models that work without traditional infrastructure, and mobile-first platforms are redefining education, healthcare, and commerce for lower-income users.

Momentum is the real advantage of operating in emerging markets. You're entering fast-moving, digitally open economies with unmet needs, local ambition, and room to grow. That's a rare combination.

What are the advantages of doing business in emerging markets?

Emerging markets offer operational advantages that businesses are using to fuel expansion. Here are some of the most visible ones:

A fast-growing customer base

These markets are adding millions of new customers every year – many of them are young, tech-savvy, and brand-conscious. Demand for mobile phones, insurance, and more rises with incomes, and businesses that show up early can become the default option as local spending power increases. If your current markets are saturated, it's worth considering the possibility of meeting that demand.

Cost advantages

Labour, real estate, and raw materials all cost less in emerging markets than in advanced economies. Countries such as India, Vietnam, and Mexico offer skilled talent at a fraction of the cost, and manufacturing and customer service hubs can run more efficiently without cutting corners. Some governments offer tax incentives or subsidies to attract foreign businesses.

This is about smart cost structures. You can stretch budgets further while building local capacity.

Local resources and supply chain proximity

Plenty of emerging markets are rich in natural resources. Businesses that work in energy, manufacturing, and food production can base operations close to the materials they rely on. Shorter supply chains can mean lower logistics costs and fewer disruptions. Governments often encourage local processing and value-added industries.

This is an opportunity to build integrated operations – source, production, and distribution – in one region.

High-growth returns and diversification

When economies grow quickly, so do the businesses that serve them. Many businesses see higher return on investment from their emerging market operations than from mature market operations. Growth in one region can offset stagnation in another, which can help diversify revenue and reduce risk. A presence in multiple markets protects you from local downturns and currency swings. All of that can make emerging markets a major growth engine.

Talent and improvement

These countries have young, ambitious populations, and that's fuelling a wave of creativity. Local teams often skip old playbooks, bring new approaches, and solve problems differently. Startups in these regions are known for "frugal innovation" – creating effective solutions with limited resources. Hiring locally means you benefit from people who understand their market deeply and want to shape its future. You can learn a lot from them.

Room to collaborate

Many governments and local firms are actively looking for international partners. There's an appetite for outside expertise, especially when paired with a commitment to local development. Joint ventures and distribution partnerships can help you scale faster, and local alliances often provide insight that might take years to obtain on your own. In many markets, collaboration is the norm.

Doing business in emerging markets means becoming part of the market while it's being built. The viable economics, valuable talent, and growing demand enhance the opportunities in these markets.

What are the risks and challenges of entering emerging markets?

Emerging markets provide opportunities, but they can be more volatile. If you're entering one, it's worth knowing what to expect. Here are potential challenges:

Political and policy uncertainty

Governments can shift quickly – and so can the rules:

• A new administration might change trade policies or foreign ownership laws overnight.

• In some markets, corruption or weak institutions can complicate permits, taxes, or contract enforcement.

• Sudden unrest or regime changes can disrupt business without warning.

This isn't a reason to stay out, but it's a reason to plan carefully. Work with local advisers, and set up flexible legal structures.

Economic instability

Fast growth often comes with high volatility:

• Inflation can peak quickly and cut into margins or erode customer demand.

• Currency swings can turn profitable sales into losses when converted to pounds or euros.

• Local interest rates might be high, which can make capital expensive if you need to borrow.

Smart financial planning – hedging, pricing flexibility, and diversified sourcing – can help keep operations steady through these swings.

Regulatory friction

The rules aren't always clear or consistent:

• Some countries have underdeveloped legal systems or confusing bureaucracies.

• Licensing, customs, or permitting processes might take months instead of weeks.

• Intellectual property protection can be weak and leave brands or inventions exposed.

The best defence is local legal expertise and an insightful compliance plan.

Infrastructure gaps

Basic infrastructure often isn't fully reliable:

• Power outages, patchy internet, and traffic-clogged roads are common in many cities.

• Logistics networks might be unreliable and slow down supply chains or raise costs.

• Last-mile delivery, warehousing, or cold storage might need to be built from scratch.

Some businesses solve this issue by partnering with local providers; others invest directly. Either way, be ready to fill in the gaps.

Cultural differences and talent challenges

Every market has its own way of doing business:

• Marketing tactics that work in your home country might not be as effective in other markets if they're not localised.

• Management styles, decision-making norms, and workplace expectations vary widely.

• Skill gaps can make hiring for certain roles more difficult, even if the overall labour supply is strong.

Bringing in local leadership and investing in training often pays off – so does building a culture that accommodates global standards and local norms.

Reputational and compliance risk

Operating in newer markets can expose you to scrutiny, especially if standards differ from those at home:

• Looser regulations regarding labour, sustainability, or supply chain practices can put your brand at risk if you cut corners or work with partners that do.

• Environmental or social missteps can lead to backlash, especially from global customers or watchdogs.

• Supply chain transparency rules typically still apply when you operate abroad, even if local norms differ.

Many businesses invest more in oversight when they operate in emerging markets. The long-term reputational and legal upside can make that worthwhile.