EMs will account for over half of global GDP within the next decade and almost 60% by 2050. Headlining this, India will become the world’s third-largest economy as soon as 2026. More generally, EMs with rapid population growth, the potential to develop manufacturing hubs (including through friendshoring), or that stand to benefit from the green transition will jump up the GDP league table. The sting in the tail is that, at an aggregate level, income convergence with DMs will be slower than it has been in the past couple of decades, partly because DMs are better placed to adopt artificial intelligence on a wide scale.
In view of the wider interest, we are also sending this Emerging Markets Update to clients of our India Economics and Long Run services.
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