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A.T. Kearney has released its 2005 Global Retail Development Index, identifying the most compelling international investment opportunities for mass merchant and food retailers looking to expand overseas.

According to the report, “India moved from second place to first in the 2005 index, displacing Russia which had held the top spot since 2003. Driving India's move was a greatly improved investment climate due to the recent relaxation of direct ownership restrictions on foreign retailers. The country's retail market totals $330 billion, is vastly underserved and has grown by 10 percent on average over the past five years. It is also one of the most fragmented retail markets in the world -- the combined market share of the top five retailers totals less than two percent.”

Russia dropped to second place, followed by the Ukraine, China, Slovenia, Latvia, Croatia, Vietnam, Turkey and Slovakia.

"Eastern Europe really represents three distinct opportunities global retailers should be acting on: Russia, traditional Eastern Europe like Hungary and Romania, and 'new' Eastern Europe like Ukraine, Slovenia and Latvia," said Fadi Farra, senior manager with A.T. Kearney and leader of the study. "Retailers who plan properly can leverage capabilities across some of these smaller, closely located countries and gain a distinct advantage."
KC's View:
Which reminds us…

If you want to read one of the best books about globalization – which includes why some of these markets are ripe for expansion by retailers – you should go out and pick up a copy of Thomas L. Friedman’s “The World Is Flat.”

It is a great read – profound, provocative and absolutely right-on.