Introduction
Investors look at a world that has numerous opportunities at the moment. These opportunities are in many sectors. However, some sectors are appearing to be taking a sizeable chunk of opportunities. This paper looks at three sectors where such opportunities are immense.
They include the energy sector, technology sector and industrial sector. Although others are anticlimaxes, many others are new challenges. However, the effect is the same: they present gaps which need to be filled. The only way to fill them is by coming up with innovative strategies. This paper will analyze the opportunities in line with these three sectors.
Energy Sector
Global Warming
This sector has monumental potential for growth. It is spans wide with far reaching possibility for dynamism in the near future. The sector, according to scholars has a tremendous void that needs to be filled. In the near future, all and sundry will be frantic about energy and the need for development of newer frontiers for its provision. This is in the advent of the global warming.
Many observers continue to point out that the energy sector remains a topic that will spill over in centuries to come. The human race has a possibility of grappling with a need for increased energy sources. This is in light of the ever burgeoning population. Many governments and non governmental organizations are also up in arms developing strategies that will ensure emission of clean energy.
Clean energy is energy that has significantly little, if any, carbon emissions. These emissions are the cause of global warming. In as much as global warming seems to be a fairytale, scholars and observers in energy sector are warning of times when global warming will be like terrorism in the eyes of people.
It is going to affect many a family and governments have to do something as soon as possible to avert a possibility of disaster (United Nations Environment Program, 2007).
In light of the above, it is factual that the energy sector is worth investing. It is not just the energy sector at large, but particular areas of the energy sector. Renowned billionaire Bill Gates was asked in an interview on CNBC which sector he would invest if he were to invest in the 21st century.
He boldly replied that he would invest in energy: clean energy. Therefore, it is a matter of factual evidence that the energy sector will be quite profitable in the near and long future. Gates statement could not be closer to the truth if governments’ strategies are anything to go by. There are frantic efforts to finance projects related to development of clean energy.
These efforts are not just emanating from governments, but also from financiers such the International Monetary Fund, The World Bank and others like The African Development Bank. When offering grants, these institutions are categorical on the amount that should be channeled towards development of clean energy. In their policies, they continue to state the importance of investing in those sectors.
They are pegging their arguments on both theoretical and empirical evidences brought forth by scientists that are studying the issue of global warming (United Nations Environment Program, 2007).
Growing Populations
The last decade has seen phenomenon growth in world’s population. The population has grown fro below 5 billion to over 6 billion. Observers are constantly warning of energy crises if more innovative ways of harnessing energy are not explored. The need for energy has increased exponentially. This trend is bound to continue if some very crucial factors are taken into consideration.
Firstly, traditional methods of getting energy are slowly becoming extinct. In Africa and third world countries like in Asia, there is need to conserve cultural and aesthetic pride. Therefore, governments are discouraging people from using the traditional methods of harnessing energy. These methods include use of firewood and burning charcoal these two forms of energy for cooking and heating are quite common in Africa.
However, there is a growing need to phase-out if forests and traditional forest cover is to be conserved. If this is to happen, alternative means of obtaining energy have to be derived. It is the responsibility of governments to come up with such alternatives.
If not governments, investors, who are keen on making a kill, should position themselves for the same. Therefore, investing in the energy sector is a good venture in light of these observations. Future benefits look like a lot.
Depletion
Traditionally, energy rich nations are reporting continued depletion of their reserves. This is a bad omen in a world that is petroleum dependent. It is however, an investment opportunity. Sustainable energy has been coined as the way forward in the advent of the current trend where energy reserves continue to report a slump. The Middle East, which is endowed with these reserves, is reporting this decline day by day.
In other countries where there is potential for oil, political instability does not guarantee any continued production of the same. Therefore, governments are left with no option other than to look for alternatives. This is where savvy investors come in. since energy continues to be a daily need in every homestead the world over, this promises to a lucrative venture as we look into the future (United Nations Environment Program, 2005).
Energy Control
It is also worth noting that investing in controlling the energy promises to be lucrative. However, the recent spillage on the Gulf of Mexico is a twist that has got investors thinking. The government, in its capacity has been unable to control such spillages. This is a loophole which needs to be filled by savvy investors. Although it calls for too much government regulation and high capital out lay, the potential of making big buck looms large.
It is also an investment opportunity to seek investment in renewable energy. This includes bio fuels, wind power and solar power. These are great alternatives been tapped into by governments as it seeks to enhance usage of the same (United Nations Environment Program, 2005).
Technology
This is the most dynamic of the opportunities that investors have today. It is constantly changing. A reasonable amount of thought has to be channeled towards research before entry into this field. The stakes are too high in this field and only the assertive ones survive.
Technology spans far and wide. But the most common form of technology nowadays is the internet and communications technology, otherwise known as ICT. This field has immense opportunities.
Internet
It is hailed as the single most drivers of economies in the 21st century. It is redefining the manner in which people does business. Analysts project a growth and penetration possibility of over 50% by the year 2015. Currently global internet penetration stands at a paltry 30%.
This presents crucial opportunities for foreign direct investments. Since many businesses are constantly getting the need to invest in that sector, especially in Africa which remains almost untapped in the sector, there is great capital redirecting that is expected to happen in near future.
The recent revolutions that have rocked Tunisia and Egypt are a pointer towards how the internet promises to change the lives of many people.
Therefore, internet has become everyone’s sensation. If the effort can be redirected to areas such as outsourcing, then the growth both socially and economically is bound to be immense. In a nutshell, the internet remains to be the trailblazer in the setting trends for other sectors. This is quite true in Africa whose penetration rate is very little. It hovers below 20% in many countries (Passion Computing, 2011).
Going Digital
Many third world countries are grappling with the need to go digital before the deadline that was set by the United Nations. The deadline, which saw member nations agree to digitalize their video streaming before 2015, has been the subject for the newly found governments’ impetus towards that goal.
In line with this technological advancement, investors, should trade their guns towards lucrative business. The world is becoming a global village with a virtuosity that is unwarranted (Passion Computing, 2011).
Hi Tech
Many other sectors are going hi tech. buildings and cars plus other accessories like phones are all experiencing a new technological side. This technological side is bringing a new appeal to customers. It is also massaging to their tastes and preferences. In a world where everyone wants to appear cool, investors should cash in on the new crave? Youngsters are in constant need to appear cool and extraordinary.
This is spilling over to all aspects of life. This includes houses (architectural technology), cars (automobile technology) and phones. This means that many other things are/will go hi tech in near future. It is the duty of investors to find out which is the next and go for it.
The most recent is the development of hi tech societies. These societies are deemed to have great knowledge and acquisition of hi tech material that is unrivalled. Examples include MIT, and Harvard Universities. Also societies like the United States and Hong Kong are ‘hi tech’ compared to the rest of the nations (Passion Computing, 2011).
Economy
Most of the fastest growing economies have either embraced technology or created one. Many economies which continue to register phenomenon growth are catapulted by technological innovations. All aspects of the economy are slowly but surely getting infiltrated with advancements in technology. ICT departments in many organizations remain to be the most dynamic.
The bottom line is that any economy that seeks to grow into the next level cannot do so without embracing technology in its operations. Most of the venture capital by governments is been channeled towards development of ICT. It also gets favor over other projects.
Many countries and organizations are embracing outsourcing as a way of doing business. It is only prepared economies that remain to benefit from such. Most of the economies are also developing other high tech areas such as energy form nuclear potential. This is a bid to remain afloat technology wise (Narula and Guimon, 2010).
Industry
This basically centers on production of goods and services. In the current century, it is not as vibrant as it was in the last century. Any industry is divided into four parts. These include: primary industry, secondary, tertiary and the relatively new quaternary industry. Basically, each of them deals in a different activity.
The quaternary industry deals in research and development while primary deals in initial production like mining. The tertiary industry deals with services and lastly secondary industry deals in refining and manufacturing. These four prongs of the industry are the pillars from which almost all sectors of the economy revolve.
New Services
This falls under the tertiary category. Billionaire Richard Branson is credited with his ability to enter into markets and creates ripples by introducing new ways of serving the customers. This is closely related to technology which is credited with bringing the new appeal to any industry. Therefore, market leaders are those organizations whose services have embraced technology.
These new services have revolutionized the manner in which people live. Many United States companies have turned to outsourcing to reduce costs associated with doing business.
Statistics show that over 30% of all multinationals are frequently outsourcing a part of their service provision to foreign companies and institutions. This is a trend that has greatly helped reduce the traffics associated with headquarters (Bureau of Economic Analysis, 2010).
New Products
When making new products companies should put into consideration much the ever changing customer preference. The advent of the mobile short messaging and e-mail has somewhat phased out growth in postal services especially in Africa. Savvy investors, however, have taken this opportunity and introduced home based postage.
This phenomenon that is only in developed countries may breathe some new life in the almost extinct postal service. This is an example of the immediate need for new products in the market. It also presents the opportunities that many investors have in that frontier.
Investment trend setters like Richard Branson have revolutionized the manner of doing business. In sectors like air travel, the entrepreneur has trail blazed the comfort associated with in-flight text messaging and phoning.
Industrial Impact: Opportunity or Anticlimax?
Many governments and human rights activists together with non governmental organizations are constantly warning of a disaster in the making in light of continued productions. All of a sudden there are needs to conserve the environment. Industries have become the main target and they need to reduce emission of harmful gases in the air to some extent.
While many industries, sectors and companies concur with this need and the spirit in it, there is discontent associated with it. This discontent looms large. However, investors who are keen on seizing opportunities are presenting the companies with long lasting solutions to this problem. So basically it is an investment opportunity (Narula and Guimon, 2010).
Industry Stats
The graph below is an indication of how industrial growth has somewhat stagnated in recent years. This is an indication of the many factors that continue to stall growth in that sector. It shows GDP levels of the major industries in United States. This is a sample of indicators in other countries that continue to register a decline.
Quick Analysis
Conclusion
The three sectors mentioned above present investors with great opportunities to invest. This is bound to continue in the near and distant future. The manner in which the opportunities present themselves may be subject to debate. However, only savvy investors stand a chance to seize these once in lifetime opportunities. The greatest impetus is from governments.
This government aims to empower the people and its investor base so as to spring them to action. The technology and energy sectors are the most likely areas for innovation considering they have so much room for change and a considerable amount of newness.
References
Bureau of Economic Analysis. (2010). Industry Economic Accounts. Web.
Narula, R. & Guimon, J. (2010). The Investment Development Path in a Globalised World: Implications for Eastern Europe. Web.
Passion Computing. (2011). The Future And The Internet. Web.
United Nations Environment Program. (2005). Public Finance Mechanisms To Catalyze Sustainable Energy Sector Growth. Web.
United Nations Environment Program. (2007). Investors Flock To Renewable Energy and Efficiency Technologies. Web.