Industryweek 4922 Iw1000hero
Industryweek 4922 Iw1000hero
Industryweek 4922 Iw1000hero
Industryweek 4922 Iw1000hero
Industryweek 4922 Iw1000hero

IW 1000 Growth is BRIC Solid

Aug. 15, 2012
China had 70 companies on the 2012 IW 1000, which represented a 26.7% average revenue growth rate Russia followed with a 26.2% average revenue growth rate India ranked third with a 22.9% average revenue growth rate

The top three countries for average revenue growth with at least 10 manufacturers on this year’s IW 1000 ranking include several countries often referred to collectively as BRIC nations (Brazil, Russia, India and China). China-based manufacturers combined to post the largest average revenue growth rate among nations with 10 or more IW 1000 manufacturers .

China had 70 companies on the 2012 IW 1000, which represented a 26.7% average revenue growth rate. Just 10 years ago, only six IW 1000 companies were based in China. Russia followed with a 26.2% average revenue growth rate. Half of Russia’s 12 companies on the list were represented by the petroleum and coal products sector. The remaining companies were either in the primary metals or fabricated metal products industries.

India ranked third with a 22.9% average revenue growth rate. Brazil was the only BRIC country that did not post average revenue gains above 20%. Manufacturers based in the South American nation combined for a 14.6% average revenue growth rate.

Despite China’s revenue growth lead, the country’s economy is slowing down. But the country is considering a new wave of stimulus spending and relaxed interest rates in an effort to reinvigorate its economy, says Alan Beaulieu, president of ITR Economics  and an IndustryWeek contributing editor. “As they look toward stimulus spending again, they’re going to create jobs and as they create jobs they’ll carry the economy forward,” Beaulieu said in June at an event hosted by IndustryWeek and the Italian Trade Commission.

In his remarks, Beaulieu said the prospect of another global recession driven by a possible economic collapse in Europe is unlikely. Russia is less likely than China to sustain its expansion because of an overreliance on its oil and gas industry, a low fertility rate and corruption, Beaulieu says. “Russia worries me the most. Putin is a thug, and Russia right now is a very dangerous place,” Beaulieu said.

Meanwhile, North American countries, particularly Mexico, also posted strong average revenue gains in 2011. The United States’ average revenue growth was 15.1%. The United States has the most IW 1000 companies with 270 manufacturers on the list, accounting for $5.6 trillion in revenue. The 27 IW 1000 manufacturers based in Canada combined for a 17.9% average revenue growth rate. Beaulieu touted Canada as one of the more promising investment opportunities moving forward, partly because of the nation’s strong banking system. “I tell Americans if you want to invest in the future, think about investing in Canada,” Beaulieu said.

Mexico’s average revenue growth rate was the highest among North American nations at 20.6%, though the country has only 10 manufacturers appearing on the IW 1000. Like Russia, Beaulieu referred to Mexico as a “dangerous place,” but said the country’s economy and manufacturing sector is booming and the nation’s standard of living is progressing.

Not surprisingly, most countries in the eurozone showed slower growth rates than North America and developing nations. Italy was the only EU country with more than 10 IW 1000 manufacturers with an average revenue growth rate above 15%. Germany’s was 11.9% and France’s was 8.7%. Despite the region’s troubles, Beaulieu said he doesn’t believe it will push the United States into a recession.

“The U.S. economy is in good recovery,” Beaulieu said. “Industrial production is picking up speed. This means good things for the rest of the world.”

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