Summary
In its July World Economic Update, the International Monetary Fund said that the global economy was beginning to pull out of a recession unprecedented in the post-World War II era and that global growth in 2010 would reach 2.5% instead of 1.9% it earlier predicted. Nevertheless, the overall impact of emerging markets on the global economy is beyond doubt. Guillermo Kopp, global research fellow at the research and analysis from TowerGroup, believes that part of the reason why expectations for emerging markets were downgraded so dramatically early in the year is that people tend to oversimplify globalization. Meanwhile, many emerging markets' governments have played the financial and economic crisis extremely skillfully so far, introducing effective stimulus packages. Emerging markets, at least the larger developing countries, now have an unprecedented amount of power. Based on their performance during the most severe economic crisis in living memory, it would be foolish to bet against them achieving momentum and regulatory reform.
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Emerging Powerhouses
In its July World Economic Update, the International Monetary Fund said that the global economy was beginning to pull out of a recession unprecedented in the post- World War II era and that global growth in 2010 would reach 2.5% instead of the 1.9% it earlier predicted. While some developed countries, most notably the United States, received upgrades, most noticeable was the substantial increase in expectations for emerging markets, with China, Russia, Mexico and India in particular sharply re-rated.
The IMF's revised expectations raised questions about the trajectory of emerging markets' growth and its potential to decouple from Western economic and financial systems - the latter a notion that many believed...See the full content of this document
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