ECONOMIC RESEARCH

Structural Challenges to Emerging Market Growth

October 07, 2013

Emerging markets are experiencing a broad-based slowing of growth which contrasts with the gradual pick-up of advanced economy growth momentum. This weakening in EM growth is not just cyclical, but also reflects underlying structural factors, including a lack of reform during years of impressive performance and a gradual exhaustion of the drivers of rapid growth. Revitalizing emerging market growth prospects will depend on advancing a broad range of interlocking reforms aimed at achieving better balanced and higher quality growth, based on refreshed growth models. The required mix of reforms and the new vision for growth will vary across countries, as discussed in detail for ten large emerging market countries in this report, but in all cases will depend on being able to overcome internal political challenges.