ALTHOUGH REMAINING STRONG in comparison to more mature markets, the
short term economic outlook in emerging markets has slowed due to a number of
cyclical forces (withdrawal of policy stimulus and capital rotation as US bond yields
rise) and structural forces (slower labor force growth, slower pace of globalisation
and the end of commodity price super cycle). This was recently reflected in financial
markets with the depreciation of several emerging markets currencies.
Consequently, the economic growth delta between emerging and advanced
countries has recently been revised downwards. In GMF 2013, the 20-year real GDP
yearly growth delta between emerging and advanced countries was equal to 3.2
percentage points (5.2% economic growth for emerging economies to compare with
2% for advanced economies) but this has slightly reduced to 2.9% in GMF 2014
(5% economic growth for emerging economies to compare with 2.1% for advanced