Top

Emerging markets’ share in global GDP rises to 45 pc, bilateral trade 50 pc

The first quarter of the twenty-first century has been transformative for emerging markets and developing economie

Chennai: Emerging markets led by India, China and Brazil have increased their share in GDP from 25 per cent to 45 since 2000 and the trade between them has risen to 50 per cent from 25 per cent. However, High debt burdens, demographic shifts, and the rising costs of climate change weigh on economic prospects, finds the World Bank.

The first quarter of the twenty-first century has been transformative for emerging markets and developing economies. These economies now account for about 45 per cent of global GDP, up from 25 per cent in 2000. This trend was driven by robust collective growth in the three largest emerging markets China, India, and Brazil.

These economies have contributed about 60 per cent to the annual global growth since 2000, double the share during the 1990s.

Interdependence among these economies has also increased markedly. Today, nearly half of goods exports from the emerging and developing markets go to other emerging and developing markets, compared to one-quarter in 2000.

As cross border linkages have strengthened, business cycles among these economies and between them and advanced economies have become more synchronized, and a distinct emerging market business cycle has emerged. Cross-border business cycle spillovers from the top three emerging markets – China, India and Brazil to other emerging markets are sizable.

However, emerging markets confront a host of headwinds. Progress implementing structural reforms in many of these economies has stalled. Globally, protectionist measures and geopolitical fragmentation have risen sharply. High debt burdens, demographic shifts, and the rising costs of climate change weigh on economic prospects.

A successful policy approach to accelerate growth and development should focus on boosting investment and productivity, navigating a difficult external environment, and enhancing macroeconomic stability.

( Source : Deccan Chronicle )
Next Story