More Companies to Call Emerging Markets Home

Emerging markets will be the headquarters to thousands more of the world’s largest companies â€" as many as half â€" in the next decade or two, a study published by the McKinsey Global Institute said Thursday.

The world’s emerging markets now account for about one-third of global gross domestic product but are home to only about one-quarter of the 8,000 companies that each generates revenue of more than $1 billion a year.

As emerging economies in Asia and elsewhere continue to outpace the relatively modest growth seen in the developing world, their share of large companies, too, will rise. About 70 percent of the 7,000 new companies that are likely to grow to the $1 billion-revenue mark by 2025 will come from emerging markets in Asia and elsewhere, the report estimated.

The projected increases also reflect the growing role that emerging markets are playing in the global economy â€" not just as sources of cheap labor but also as consumers of goods and services.

Between 1980 and 2000, just 5 percent of the world’s 500 largest companies came from emerging markets. That ratio has now risen to about 25 percent and is expected to climb to as much as 50 percent by 2025, the report said. The greater China region alone could become home to the headquarters of about a quarter of the 500 largest companies in the world, the study estimated.

“The world’s competitive landscape will be transformed over the next 10 to 15 years by the rise of a formidable new breed of large emerging-market companies,” said Richard Dobbs, one of the report’s authors. “The long-established dominance of Western multinationals is about to be challenged.”

By 2025, the report said, “some of the global leaders in many industries may be companies we have not yet heard of, and many are likely to be based in cities that we could not point to on a map.”