How the world echoes Orwell

By John Willman

Financial Times

Published: February 26 2005

George W. Bush has just returned from a trip to what he knows as Europe. But to most big US companies, the president has been to an altogether different place called Emea, home to more than 1.5bn people.

It stands for Europe, the Middle East and Africa and it is one of three regions the world is divided into by large transnational businesses - the other two are the Americas and the Asia-Pacific region.

In dividing up the globe in this way, companies are unwittingly echoing George Orwell's 1984,in which the world is divided into three great power blocs: Oceania, Eurasia and Eastasia. However, it can have disconcerting consequences for customers.

The business regions are similar to Orwell's but not identical. The Eurasia of 1984 excluded the UK, which was part of Oceania along with the US and some former British colonies.

Orwell could not have foreseen the growing economic integration of the New World that often means the Americas is the largest market for big transnationals. But he rightly spotted the re-emergence of China, Japan and other Pacific rim countries as a global powerhouse - even as those countries picked themselves up from the devastation of war.

The corporate three-way division is for administrative purposes. Emea may stretch from Lapland in the north to Cape Town in the south and includes the Islamic world as well as black Africa. Yet most of it is in a similar time zone and in relatively easy reach of regional headquarters based in Europe.

But it often encourages companies to see Emea as a single market - as the multiple languages on packaging often demonstrate.

Electronic products sold by Japanese companies contain six or eight instruction manuals in different languages. US software makers fill their otherwise almost empty cartons with details of warranty arrangements from Scandinavia to Zimbabwe, from Mauretania to Afghanistan.

The vice-president, marketing (Emea) of a drinks company must sell its tipples in teetotal Islamic countries, the wine-drinking cafe societies of southern Europe and the binge boozing bars of the beer-drinking north.

Food manufacturing executives land in Emea with their latest fast-food successes from North America, oblivious to the different approach to dining in the Old World. They try to sell the same products throughout the region, ignoring the cultural and gastronomic differences even between neighbouring countries.

Investors must also learn to understand the business cycle of Emea if they invest in large international companies. With the dollar in decline against the euro and the pound, profits in Emea are worth much more than those in the US. (A few years ago, it was the other way round.)

So welcome to Emea and welcome also to the fact that Orwell was wrong about one thing. The world may not be entirely at peace but there is no continuing war between the three great blocs that dominate the globe - except, of course, on cultural matters.

The writer is associate editor of the Financial Times