Emerging Markets to Lead Global Economic Growth
According to a report by S&P Global, emerging markets such as India, Vietnam, the Philippines, and Indonesia are set to drive global economic growth. These countries are projected to grow at an average rate of 4.06% of GDP through 2035, significantly higher than the 1.59% projected for advanced economies.
Key Contributors to Global Growth
By 2035, emerging markets will account for approximately 65% of global economic growth. The report highlights that India will become the world’s third-largest economy, with Indonesia and Brazil ranking eighth and ninth, respectively. This shift underscores the growing economic influence of these markets.
Factors Driving Growth
Favorable demographics are a major factor in this growth, with old-age dependent populations averaging only 24% through 2035. This results in a larger labor force and expanding consumer markets. Additionally, technological advancements in AI, automation, and robotics are expected to boost productivity, although they may also disrupt labor dynamics.
Doubts Revealed
Emerging Markets -: Emerging markets are countries that are in the process of becoming more advanced economically. They are not as rich as countries like the USA or Japan but are growing quickly. India and Vietnam are examples of emerging markets.
GDP -: GDP stands for Gross Domestic Product. It is the total value of all goods and services produced in a country in a year. It helps us understand how big or small a country’s economy is.
Advanced Economies -: Advanced economies are countries with very high levels of income and industrialization. They have well-developed infrastructure and technology. Examples include the USA, Germany, and Japan.
Demographics -: Demographics refer to the characteristics of a population, like age, gender, and income. Favorable demographics mean having a large number of young people who can work and contribute to the economy.
AI and Automation -: AI stands for Artificial Intelligence, which is when machines can do tasks that usually need human intelligence. Automation is using machines to do work without human help. These technologies can make work faster and easier but might also change how jobs are done.
Labor Dynamics -: Labor dynamics refer to how jobs and work change over time. This can include how many jobs are available, what kind of jobs people do, and how much they get paid. New technologies like AI can change these dynamics by creating new jobs or making some jobs disappear.
