"Connecting communities, empowering nations: Unifying the Regional and Global Economy ."

Emerging markets play a crucial role in shaping global economic growth. These markets, which are characterized by sustained strong growth, stability, and participation in global trade and financial market integration, have the potential to produce higher-value-added goods and services, similar to advanced economies. Here are some key points about emerging markets and their impact on the global economy:

Diverse and significant

Emerging markets are diverse and defy a uniform narrative. They are generally identified based on attributes such as sustained market access, progress in reaching middle-income levels, and greater global economic relevance. They have a systemic presence, with a significant share of the global economy, population, and exports.

Overcoming crises: Past crises have demonstrated that emerging market policymakers can overcome adverse shocks and rebuild economic resilience. These markets have the potential to bounce back from challenges and continue their growth trajectory.

Trade and economic growth Integration into the world economy has proven to be a powerful means for countries to promote economic growth, development, and poverty reduction. The growth of world trade has averaged 6 percent per year over the past 20 years, twice as fast as world output. Countries that have opened their economies in recent years, including India, Vietnam, and Uganda, have experienced faster growth and more poverty reduction.

Free trade agreements (FTAs):

FTAs create additional trade between member countries by lowering import barriers and opening markets for producers. The direction and magnitude of trade changes vary by country, with some experiencing export growth, while others undergo trade reallocation. However, the overall impact of FTAs on developing countries is positive, as they contribute to increased trade and economic growth.

Benefits of open trade policies: Countries that are open to international trade tend to grow faster, innovate, improve productivity, and provide higher income and more jobs. Trade volumes grew by 4.3% in 2017, the fastest rate in 6 years, benefiting economies, companies, and citizens by increasing access to goods and services at lower prices.

To continue their growth and contribution to the global economy, emerging markets need to balance overcoming the pandemic, returning to more normal policies, and rebuilding their economies.

Citations:
[1] Global Trade Liberalization and the Developing Countries — An IMF Issues Brief https://www.imf.org/external/np/exr/ib/2001/110801.htm
[2] Miles to Go: The Future of Emerging Markets – IMF F&D https://www.imf.org/external/pubs/ft/fandd/2021/06/the-future-of-emerging-markets-duttagupta-and-pazarbasioglu.htm
[3] Free Trade Agreements Mean Export Growth for Some Countries, Reallocation of Trade for Others – USDA ERS https://www.ers.usda.gov/amber-waves/2023/february/free-trade-agreements-mean-export-growth-for-some-countries-reallocation-of-trade-for-others/
[4] Stronger Open Trade Policies Enable Economic Growth for All – World Bank https://www.worldbank.org/en/results/2018/04/03/stronger-open-trade-policies-enables-economic-growth-for-all
[5] Trade and Globalization – Our World in Data https://ourworldindata.org/trade-and-globalization
[6] Trade Overview – World Bank https://www.worldbank.org/en/topic/trade/overview