China and India were rated the most attractive emerging markets for UK businesses in a report on the role of general counsel in emerging markets.
The Baker & McKenzie (B&M) report surveyed 51 board executives at FTSE 500 companies. B&M London managing partner Gary Senior commented: "With the growing importance of emerging economies, and the opportunities and risks involved in doing business with them, demands on general counsel have increased."
Risk management and tax planning were identified as vital. The report said potential business partners should undergo rigorous investigation and dispute resolution and exit hurdles should be dealt with. While local regulations had to be understood, liability in the UK for practices abroad could not be ignored.
UK businesses were keen on low-cost manufacturing and sales opportunities in growing markets, but sought detailed risk assessment.
Two-thirds of respondents were already operating in China, citing its benefits as cheap labour and a strong work ethic, and its disadvantages as IP piracy. India has a skilled, English-speaking and cost-effective labour force, with its weaknesses being its poor infrastructure and protected market. Investments in the two countries tended to be joint ventures or partnerships.
Russia, with its natural resources and growing consumer appetites, and Brazil, with political and economic stability, were the next most popular locations. Russia's main downside was corruption and Brazil's was strong local and US competition.