Decade of emerging economies: https://timesofindia.indiatimes.com/blogs/toi-edit-page/decade-of-emerging-economies-2020s-will-see-debt-heavy-us-china-slowing-down-the-likes-of-india-south-africa-vietnam-step-up/ 2020s will see debt-heavy US, China slowing down & the likes of India, South Africa, Vietnam step up
April 29, 2022, Ruchir Sharma
Heavy debt have often taken down empires, and Washington rolled out the most generous stimulus package pushing it debts to new heights.
China's risong share of global GDP has come largely at the expense of Europe and Japan. The new winners may well be emerging economies outside China.. In the past emerging world success were mainly export manufacturing economies. Now both exports and manufacturing is shrinking as a share of global GDP. ..
The campaign to build a greener global economy has simultaneously increase demand for energy and raw materials, while making it difficult to invest in new oil fields, smelters, mines etc. The new commodity up-cycle should lift fortunes of major exporters like Brazel, South Africa and Saudi Arabia.
Instead of borrowing, many were forced to adopt reforms. India has privatising some of its state owned enterprises, Inoinesia has cut taxes, and eased Labour Laws, And Saudi Arabia is loosening immigration barriers. Consumers are moving more quickly to adopt mobile internet services. India for instance, is home to as many new tech companies as is france or Germany..
in the coming decade, the world fastest growing economies, will still be found in the emerging world..
Are emerging economies on the verge of another “lost decade”? https://www.economist.com/finance-and-economics/are-emerging-economies-on-the-verge-of-another-lost-decade/21808963
Rising interest rates, inflation and geopolitics are a toxic mix
Both public and private debt in the emerging world rose steadily as a share of GDP during the 2010s, and rocketed during the pandemic. Public-debt ratios across middle-income economies now stand at record highs, and indebtedness in the poorest countries has risen towards the debilitating levels of the 1990s. Of the world’s 70-odd low-income countries, more than 10%, including Chad and Somalia, already face unsustainable debt burdens. Another 50%, including Ethiopia and Laos, are at high risk of being in a similar position, according to the World Bank. A decade ago only about a third of poor countries were in, or at high risk of, debt distress.
Markets are already heaping pressure on vulnerable emerging economies. As capital flows to America to take advantage of higher rates, the dollar is strengthening: it is up by more than 10% over the past year. Funding costs in the emerging world are rising with it.
Some emerging markets stand to benefit from an era of stagnation. Firms wary of dependence on China could move production to other low-cost places. Rich countries hoping to prevent poorer ones from drawing closer to Russia and China could lower trade barriers and increase investment abroad, boosting growth prospects in the process. High commodity prices, while they last, will buoy the fortunes of food, energy and metals exporters.
Overall, however, the higher debts and forgone investment in human and physical capital of the past few years will take a heavy toll.