Yet Marcussen said there are still reasons to worry about the outlook for emerging nations, even though they now boast more flexible currencies, stronger trade positions, larger reserves and more developed markets than in previous decades.
China’s economy is now the world’s second-largest and its share of global GDP has jumped to 14 percent from 4 percent in two decades, she said. That is a problem if China struggles to refocus demand toward domestic sources, especially after a report last week showed that manufacturing may contract for the first time in six months.
The large imbalances and poor policy that drove past crises are still prevalent in Argentina, Venezuela, Chile, Peru, South Africa, the Ukraine, Turkey and Thailand, she added. Add Brazil, Indonesia, India and Russia, which have weak spots, to that list and 13 percent of global GDP is in question, Marcussen said.
The outlook ultimately may pivot on how China fares, said Frederic Neumann, HSBC Holdings PLC co-head of Asian economics research in Hong Kong.
Beijing is implementing its biggest policy shifts since the 1990s and tackling debt-fueled investment in a bid to generate more manageable growth based on local rather than international demand.