Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness?
A synchronous growth slowdown has been underway in emerging markets (EM) since 2010. Growth in these countries is now markedly slower than, not just the pre‐crisis average, but also the long‐term average. As a group, EM growth eased from 7.6 percen...
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| Format: | Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2016
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| Online Access: | http://documents.worldbank.org/curated/en/2015/12/25666217/slowdown-emerging-markets-rough-patch-or-prolonged-weakness http://hdl.handle.net/10986/23566 |
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okr-10986-23566 |
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oai_dc |
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Digital Repository |
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Foreign Institution |
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Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
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English en_US |
| topic |
GROWTH RATES MONETARY POLICY CAPITAL MARKETS CAPITAL GOODS DURABLE GOODS ECONOMIC GROWTH TECHNOLOGICAL PROGRESS URBANIZATION MULTIPLIERS TERMS‐OF‐TRADE INTERNATIONAL CAPITAL EXPOSURES OIL PRICES FISCAL DEFICITS INTEREST INCOME EXPECTATIONS ECONOMIC CONSEQUENCES INTEREST RATE EMERGING ECONOMIES PROPERTY RIGHTS EXCHANGE BALANCE OF PAYMENTS MACROECONOMIC POLICY RESOURCE ALLOCATION LABOR FORCE POLITICAL ECONOMY INTERNATIONAL CAPITAL MARKETS DEVELOPING ECONOMIES REVENUES TECHNOLOGICAL CHANGES FISCAL POLICY WORLD DEVELOPMENT INDICATORS ECONOMIC EFFECTS LABOR INPUTS INCENTIVES EQUILIBRIUM ECONOMIC CONSEQUENCES MODELS CAPITAL MARKETS SUSTAINABLE DEVELOPMENT CENTRAL BANKS ENERGY TAXES BUSINESS CYCLES DEVELOPED COUNTRIES ECONOMIC EFFECTS EMERGING MARKET ECONOMIES ECONOMIC ACTIVITY FISCAL POLICIES OIL PRICES GLOBAL ECONOMY OIL CURRENCY EXPORT GROWTH TERMS OF TRADE ADVANCED ECONOMIES POPULATION GROWTH IRREVERSIBILITY DEBTS NATURAL RESOURCES OPTIONS LABOR PRODUCTIVITY INTEREST RATES STRUCTURAL UNEMPLOYMENT OPEC EMERGING MARKET DEBT SCIENTIFIC KNOWLEDGE GOVERNANCE INDICATORS TAX REFORM PRIVATE CAPITAL FLOWS LABOR PRODUCTIVITY DIVIDENDS TERMS OF TRADE PRIVATE CAPITAL NATURAL RESOURCES PRODUCTION PROCESSES METALS FINANCIAL SYSTEM SUBSIDIES EFFICIENCY PURCHASING POWER MARKET ECONOMIES TAXES CAPITAL CONSTRAINTS GOVERNMENT SECURITIES RESOURCES INFRASTRUCTURE INVESTMENT UNEMPLOYMENT EMERGING MARKETS DEREGULATION ENERGY CONSUMPTION EQUITY INVESTORS PRODUCTIVITY GROWTH DATA AVAILABILITY CONSUMPTION SCIENTIFIC KNOWLEDGE WAGES INTERNATIONAL TRADE VOLATILITY VALUES FINANCIAL CRISIS FUTURE FISCAL POLICIES ECONOMIC GROWTH SHARE OF WORLD OUTPUT DISCOUNT RATES CREDIT WORLD ECONOMY PURCHASING POWER DEMAND NATIONAL INCOME MARKET ECONOMIES AGGREGATE DEMAND DISINFLATION POPULATION GROWTH ENVIRONMENTS EXPENDITURES CAPITAL FLOWS PROPERTY ADVANCED ECONOMY GLOBAL RISKS LABOR MARKETS ENVIRONMENT LABOR FORCE RESOURCE ALLOCATION DEVELOPED COUNTRIES MONETARY POLICIES EXPANSIONARY FISCAL POLICY ECONOMICS INFLATION‐TARGETING TERMS OF TRADE SECURITIES OUTPUT GLOBAL FINANCIAL MARKET CAPITAL GOODS GOVERNANCE STOCK INDEXES DISCOUNT RATES BUSINESS CYCLES CURRENCIES GOVERNMENT DEBT ECONOMIC DEVELOPMENT TRADE LAND MARKET VOLATILITY FINANCIAL MARKET INVESTMENT BOND SHARE INVESTMENT CLIMATE GLOBAL OUTPUT BALANCE SHEETS COAL BUSINESS ENVIRONMENT ECONOMIC DEVELOPMENT SUSTAINABLE DEVELOPMENT BANKING GLOBAL INVESTORS PRIVATE CONSUMPTION WORLD TRADE PRODUCTIVITY GROWTH ECONOMISTS ENERGY TAXES TAX REFORM ECONOMIC GROWTH DEMOGRAPHIC ENVIRONMENTAL LABOR MARKETS COMMODITY PRICES POWER OUTAGES COMMODITY STRUCTURAL UNEMPLOYMENT ADVERSE EFFECTS ECONOMIC GROWTH PROPERTY RIGHTS LABOR INPUTS GLOBAL ECONOMIC PROSPECTS PRICES CAPITAL CONSTRAINTS ECONOMIC CONDITIONS INTERNATIONAL BEST PRACTICE ECONOMIES PRODUCTION PROCESSES |
| spellingShingle |
GROWTH RATES MONETARY POLICY CAPITAL MARKETS CAPITAL GOODS DURABLE GOODS ECONOMIC GROWTH TECHNOLOGICAL PROGRESS URBANIZATION MULTIPLIERS TERMS‐OF‐TRADE INTERNATIONAL CAPITAL EXPOSURES OIL PRICES FISCAL DEFICITS INTEREST INCOME EXPECTATIONS ECONOMIC CONSEQUENCES INTEREST RATE EMERGING ECONOMIES PROPERTY RIGHTS EXCHANGE BALANCE OF PAYMENTS MACROECONOMIC POLICY RESOURCE ALLOCATION LABOR FORCE POLITICAL ECONOMY INTERNATIONAL CAPITAL MARKETS DEVELOPING ECONOMIES REVENUES TECHNOLOGICAL CHANGES FISCAL POLICY WORLD DEVELOPMENT INDICATORS ECONOMIC EFFECTS LABOR INPUTS INCENTIVES EQUILIBRIUM ECONOMIC CONSEQUENCES MODELS CAPITAL MARKETS SUSTAINABLE DEVELOPMENT CENTRAL BANKS ENERGY TAXES BUSINESS CYCLES DEVELOPED COUNTRIES ECONOMIC EFFECTS EMERGING MARKET ECONOMIES ECONOMIC ACTIVITY FISCAL POLICIES OIL PRICES GLOBAL ECONOMY OIL CURRENCY EXPORT GROWTH TERMS OF TRADE ADVANCED ECONOMIES POPULATION GROWTH IRREVERSIBILITY DEBTS NATURAL RESOURCES OPTIONS LABOR PRODUCTIVITY INTEREST RATES STRUCTURAL UNEMPLOYMENT OPEC EMERGING MARKET DEBT SCIENTIFIC KNOWLEDGE GOVERNANCE INDICATORS TAX REFORM PRIVATE CAPITAL FLOWS LABOR PRODUCTIVITY DIVIDENDS TERMS OF TRADE PRIVATE CAPITAL NATURAL RESOURCES PRODUCTION PROCESSES METALS FINANCIAL SYSTEM SUBSIDIES EFFICIENCY PURCHASING POWER MARKET ECONOMIES TAXES CAPITAL CONSTRAINTS GOVERNMENT SECURITIES RESOURCES INFRASTRUCTURE INVESTMENT UNEMPLOYMENT EMERGING MARKETS DEREGULATION ENERGY CONSUMPTION EQUITY INVESTORS PRODUCTIVITY GROWTH DATA AVAILABILITY CONSUMPTION SCIENTIFIC KNOWLEDGE WAGES INTERNATIONAL TRADE VOLATILITY VALUES FINANCIAL CRISIS FUTURE FISCAL POLICIES ECONOMIC GROWTH SHARE OF WORLD OUTPUT DISCOUNT RATES CREDIT WORLD ECONOMY PURCHASING POWER DEMAND NATIONAL INCOME MARKET ECONOMIES AGGREGATE DEMAND DISINFLATION POPULATION GROWTH ENVIRONMENTS EXPENDITURES CAPITAL FLOWS PROPERTY ADVANCED ECONOMY GLOBAL RISKS LABOR MARKETS ENVIRONMENT LABOR FORCE RESOURCE ALLOCATION DEVELOPED COUNTRIES MONETARY POLICIES EXPANSIONARY FISCAL POLICY ECONOMICS INFLATION‐TARGETING TERMS OF TRADE SECURITIES OUTPUT GLOBAL FINANCIAL MARKET CAPITAL GOODS GOVERNANCE STOCK INDEXES DISCOUNT RATES BUSINESS CYCLES CURRENCIES GOVERNMENT DEBT ECONOMIC DEVELOPMENT TRADE LAND MARKET VOLATILITY FINANCIAL MARKET INVESTMENT BOND SHARE INVESTMENT CLIMATE GLOBAL OUTPUT BALANCE SHEETS COAL BUSINESS ENVIRONMENT ECONOMIC DEVELOPMENT SUSTAINABLE DEVELOPMENT BANKING GLOBAL INVESTORS PRIVATE CONSUMPTION WORLD TRADE PRODUCTIVITY GROWTH ECONOMISTS ENERGY TAXES TAX REFORM ECONOMIC GROWTH DEMOGRAPHIC ENVIRONMENTAL LABOR MARKETS COMMODITY PRICES POWER OUTAGES COMMODITY STRUCTURAL UNEMPLOYMENT ADVERSE EFFECTS ECONOMIC GROWTH PROPERTY RIGHTS LABOR INPUTS GLOBAL ECONOMIC PROSPECTS PRICES CAPITAL CONSTRAINTS ECONOMIC CONDITIONS INTERNATIONAL BEST PRACTICE ECONOMIES PRODUCTION PROCESSES Didier, Tatiana Kose, M. Ayhan Ohnsorge, Franziska Ye, Lei Sandy Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? |
| relation |
Policy Research Note,PRN/15/04; |
| description |
A synchronous growth slowdown has been
underway in emerging markets (EM) since 2010. Growth in
these countries is now markedly slower than, not just the
pre‐crisis average, but also the long‐term average. As a
group, EM growth eased from 7.6 percent in 2010 to 4.5
percent in 2014, and is projected to slow further to below 4
percent in 2015. This moderation has affected all regions
(except South Asia) and is the most severe in Latin America
and the Caribbean. The deceleration is highly synchronous
across countries, especially among large EM. By 2015, China,
Russia, and South Africa had all experienced three
consecutive years of slower growth. The EM‐AE growth
differential has narrowed to two percentage points in 2015,
well below the 2003‐08 average of 4.8 percentage points and
near the long‐term average differential of 1990‐2008. The
recent slowdown in EM has been a source of a lively debate,
as evident from the quotations at the beginning of this
note. Some economists paint a bleak picture for the future
of EM and argue that the impressive growth performance of EM
prior to the crisis was driven by temporary commodity booms
and rapid debt accumulation, and will not be sustained.
Others emphasize that a wide range of cyclical and
structural factors are driving the slowdown: weakening
macroeconomic fundamentals after the crisis; prospective
tightening in financial conditions; resurfacing of
deep‐rooted governance problems in EM; and difficulty
adjusting to disruptive technological changes. Still others
highlight differences across EM and claim that some of them
are in a better position to weather the slowdown and will
likely register strong growth in the future. This policy
research note seeks to help move the debate forward by
examining the main features, drivers, and implications of
the recent EM slowdown and provides a comprehensive analysis
of available policy options to counteract it. |
| format |
Working Paper |
| author |
Didier, Tatiana Kose, M. Ayhan Ohnsorge, Franziska Ye, Lei Sandy |
| author_facet |
Didier, Tatiana Kose, M. Ayhan Ohnsorge, Franziska Ye, Lei Sandy |
| author_sort |
Didier, Tatiana |
| title |
Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? |
| title_short |
Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? |
| title_full |
Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? |
| title_fullStr |
Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? |
| title_full_unstemmed |
Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? |
| title_sort |
slowdown in emerging markets : rough patch or prolonged weakness? |
| publisher |
World Bank, Washington, DC |
| publishDate |
2016 |
| url |
http://documents.worldbank.org/curated/en/2015/12/25666217/slowdown-emerging-markets-rough-patch-or-prolonged-weakness http://hdl.handle.net/10986/23566 |
| _version_ |
1764454278457458688 |
| spelling |
okr-10986-235662021-04-23T14:04:16Z Slowdown in Emerging Markets : Rough Patch or Prolonged Weakness? Didier, Tatiana Kose, M. Ayhan Ohnsorge, Franziska Ye, Lei Sandy GROWTH RATES MONETARY POLICY CAPITAL MARKETS CAPITAL GOODS DURABLE GOODS ECONOMIC GROWTH TECHNOLOGICAL PROGRESS URBANIZATION MULTIPLIERS TERMS‐OF‐TRADE INTERNATIONAL CAPITAL EXPOSURES OIL PRICES FISCAL DEFICITS INTEREST INCOME EXPECTATIONS ECONOMIC CONSEQUENCES INTEREST RATE EMERGING ECONOMIES PROPERTY RIGHTS EXCHANGE BALANCE OF PAYMENTS MACROECONOMIC POLICY RESOURCE ALLOCATION LABOR FORCE POLITICAL ECONOMY INTERNATIONAL CAPITAL MARKETS DEVELOPING ECONOMIES REVENUES TECHNOLOGICAL CHANGES FISCAL POLICY WORLD DEVELOPMENT INDICATORS ECONOMIC EFFECTS LABOR INPUTS INCENTIVES EQUILIBRIUM ECONOMIC CONSEQUENCES MODELS CAPITAL MARKETS SUSTAINABLE DEVELOPMENT CENTRAL BANKS ENERGY TAXES BUSINESS CYCLES DEVELOPED COUNTRIES ECONOMIC EFFECTS EMERGING MARKET ECONOMIES ECONOMIC ACTIVITY FISCAL POLICIES OIL PRICES GLOBAL ECONOMY OIL CURRENCY EXPORT GROWTH TERMS OF TRADE ADVANCED ECONOMIES POPULATION GROWTH IRREVERSIBILITY DEBTS NATURAL RESOURCES OPTIONS LABOR PRODUCTIVITY INTEREST RATES STRUCTURAL UNEMPLOYMENT OPEC EMERGING MARKET DEBT SCIENTIFIC KNOWLEDGE GOVERNANCE INDICATORS TAX REFORM PRIVATE CAPITAL FLOWS LABOR PRODUCTIVITY DIVIDENDS TERMS OF TRADE PRIVATE CAPITAL NATURAL RESOURCES PRODUCTION PROCESSES METALS FINANCIAL SYSTEM SUBSIDIES EFFICIENCY PURCHASING POWER MARKET ECONOMIES TAXES CAPITAL CONSTRAINTS GOVERNMENT SECURITIES RESOURCES INFRASTRUCTURE INVESTMENT UNEMPLOYMENT EMERGING MARKETS DEREGULATION ENERGY CONSUMPTION EQUITY INVESTORS PRODUCTIVITY GROWTH DATA AVAILABILITY CONSUMPTION SCIENTIFIC KNOWLEDGE WAGES INTERNATIONAL TRADE VOLATILITY VALUES FINANCIAL CRISIS FUTURE FISCAL POLICIES ECONOMIC GROWTH SHARE OF WORLD OUTPUT DISCOUNT RATES CREDIT WORLD ECONOMY PURCHASING POWER DEMAND NATIONAL INCOME MARKET ECONOMIES AGGREGATE DEMAND DISINFLATION POPULATION GROWTH ENVIRONMENTS EXPENDITURES CAPITAL FLOWS PROPERTY ADVANCED ECONOMY GLOBAL RISKS LABOR MARKETS ENVIRONMENT LABOR FORCE RESOURCE ALLOCATION DEVELOPED COUNTRIES MONETARY POLICIES EXPANSIONARY FISCAL POLICY ECONOMICS INFLATION‐TARGETING TERMS OF TRADE SECURITIES OUTPUT GLOBAL FINANCIAL MARKET CAPITAL GOODS GOVERNANCE STOCK INDEXES DISCOUNT RATES BUSINESS CYCLES CURRENCIES GOVERNMENT DEBT ECONOMIC DEVELOPMENT TRADE LAND MARKET VOLATILITY FINANCIAL MARKET INVESTMENT BOND SHARE INVESTMENT CLIMATE GLOBAL OUTPUT BALANCE SHEETS COAL BUSINESS ENVIRONMENT ECONOMIC DEVELOPMENT SUSTAINABLE DEVELOPMENT BANKING GLOBAL INVESTORS PRIVATE CONSUMPTION WORLD TRADE PRODUCTIVITY GROWTH ECONOMISTS ENERGY TAXES TAX REFORM ECONOMIC GROWTH DEMOGRAPHIC ENVIRONMENTAL LABOR MARKETS COMMODITY PRICES POWER OUTAGES COMMODITY STRUCTURAL UNEMPLOYMENT ADVERSE EFFECTS ECONOMIC GROWTH PROPERTY RIGHTS LABOR INPUTS GLOBAL ECONOMIC PROSPECTS PRICES CAPITAL CONSTRAINTS ECONOMIC CONDITIONS INTERNATIONAL BEST PRACTICE ECONOMIES PRODUCTION PROCESSES A synchronous growth slowdown has been underway in emerging markets (EM) since 2010. Growth in these countries is now markedly slower than, not just the pre‐crisis average, but also the long‐term average. As a group, EM growth eased from 7.6 percent in 2010 to 4.5 percent in 2014, and is projected to slow further to below 4 percent in 2015. This moderation has affected all regions (except South Asia) and is the most severe in Latin America and the Caribbean. The deceleration is highly synchronous across countries, especially among large EM. By 2015, China, Russia, and South Africa had all experienced three consecutive years of slower growth. The EM‐AE growth differential has narrowed to two percentage points in 2015, well below the 2003‐08 average of 4.8 percentage points and near the long‐term average differential of 1990‐2008. The recent slowdown in EM has been a source of a lively debate, as evident from the quotations at the beginning of this note. Some economists paint a bleak picture for the future of EM and argue that the impressive growth performance of EM prior to the crisis was driven by temporary commodity booms and rapid debt accumulation, and will not be sustained. Others emphasize that a wide range of cyclical and structural factors are driving the slowdown: weakening macroeconomic fundamentals after the crisis; prospective tightening in financial conditions; resurfacing of deep‐rooted governance problems in EM; and difficulty adjusting to disruptive technological changes. Still others highlight differences across EM and claim that some of them are in a better position to weather the slowdown and will likely register strong growth in the future. This policy research note seeks to help move the debate forward by examining the main features, drivers, and implications of the recent EM slowdown and provides a comprehensive analysis of available policy options to counteract it. 2016-01-05T22:25:28Z 2016-01-05T22:25:28Z 2015-12 Working Paper http://documents.worldbank.org/curated/en/2015/12/25666217/slowdown-emerging-markets-rough-patch-or-prolonged-weakness http://hdl.handle.net/10986/23566 English en_US Policy Research Note,PRN/15/04; CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Working Paper Publications & Research |