October 14, 2018

Emerging Economies: Progress Until Now

Posted in Uncategorized tagged at 8:16 am by Keith Knutsson

Emerging economies made up two-thirds of the world’s GDP growth over 50% of new consumption in an analysis that includes the past 15 years, yet Economic growth among those economies vary widely. Seven economies managed real average  annual GDP growth of 3.5 percent for over 50 years. Those seven economies are China, Hong Kong, Indonesia, Malaysia, Singapore, South Korea, and Thailand, Ethiopia, India, Kazakhstan, Laos, Myanmar, Turkmenistan, Uzbekistan, and Vietnam managed to have real average annual GDP growth of over 5 percent for over 20 years.

The impacts of such growth is documented well through the diminishing of extreme poverty, a number that has now decreased by more than one billion. From the period of 1990 to 2013, the number of people living in extreme poverty in emerging economies decreased from 1.84 billion to 766 million; this means that less than 11 percent of the world’s population is experiencing extreme poverty, a number that used to be 35 percent in 1990. Additionally, the countries see a new emergence of middle and affluent socioeconomic classes. This emergence have joined the worldwide “consuming class”, which is classified as people with high enough incomes to become significant consumers of goods and services. In India this class has increased tenfold in only two decades, from 3.4 million in 1995 to more than 35 million in 2016.

Keith Knutsson of Integrale Advisors commented, “Even though financial news have been hammered with the recent struggles in the emerging market space, it is important to take a neutral, long-term look as an investor. There has been tremendous growth in many of the emerging market economies.”

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