Giving Compass’ Take:
• Desmond Lachman at AEI argues that U.S. policymakers would make a grave mistake to dismiss the emerging market economies’ diminishing economic prospects as an event occurring abroad with little likely impact on the U.S. economy.
• Will impact investments start to grow in popularity within global development as an innovative financing tool?
Over the past decade, the emerging market economies have been the primary source of world economic growth, and they now account for around one half of the global economy. This has to make their more recent economic slowing and darkening economic prospects of considerable concern to global economic policymakers.
This would seem to be particularly the case considering that the emerging market economic slowdown has been occurring not at a time of global monetary policy tightening but rather at a time when the world’s major central banks have been shifting to an easier monetary policy stance.
There can be little doubt that output is now falling in a number of smaller emerging market economies, including Argentina, Iran, Turkey and Venezuela. Nor can there be much doubt that the economic prospects in these countries will all too likely worsen meaningfully in the months ahead.
Read the full article about emerging market economies by Desmond Lachman at AEI.
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