{
  "title": "Three Key Questions About the Slowdown in Emerging Markets",
  "publication": "IMF Blog, September 18, 2014",
  "sourceUrl": "https://www.imf.org/en/blogs/articles/2014/09/18/three-key-questions-about-the-slowdown-in-emerging-markets",
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  "summary": "Yes — they have been slowing down for some time.",
  "sections": [
    {
      "heading": "Are emerging markets slowing down?",
      "content": "- Yes — they have been slowing down for some time.\n- GDP growth path:\n  - \"7 percent\" during the pre-crisis period (2003-8)\n  - \"6 percent\" over the post-crisis period (2010-13)\n  - \"5 percent, in our projections, over the next 5 years (2014-18)\"\n- Revisions to the medium-term outlook have been serially downward since 2010; this pattern of repeated downward revisions is highlighted as unique to the current downturn.\n- The slowdown is broad based:\n  - Growth rates are lower than the pre-crisis average in \"more than 70 percent\" of emerging markets since 2012."
    },
    {
      "heading": "Implications for the world economy",
      "content": "- Overall assessment: Yes — the slowdown has meaningful spillovers (see the IMF's 2014 Spillover Report).\n- Expected spillover channels and effects:\n  - Trade channel: A \"1 percentage point\" slowdown in emerging market economies lowers growth in advanced economies by \"¼ percentage point,\" on average, through reduced trade.\n  - Commodity prices: Slower emerging market demand leads to lower commodity prices; the income effect depends on whether a nation mainly consumes (benefit) or produces (loss) those commodities.\n  - Financial sector: Slower growth can trigger loan repayment problems and capital losses for banks, including banks in advanced economies exposed to Emerging Market borrowers.\n  - Regional/neighborhood effects: Slowdowns transmit locally through trade, remittances, and financing/cooperation agreements. Examples cited:\n    - China → emerging Asia (trade)\n    - Brazil → Southern Cone countries (trade)\n    - Russia → Central Asian neighbors (remittances)\n    - Venezuela → Central American neighbors (financing and energy cooperation agreements)"
    },
    {
      "heading": "Can anything be done to reduce risks?",
      "content": "- Yes — international coordination and policy preparedness are emphasized.\n- Recommended approaches:\n  - Increased collaboration between advanced and emerging market economies to manage spillovers and potential spillbacks (effects on the original spillover source economies).\n  - Renewed attention to structural reforms in emerging economies to boost productivity and medium-term growth.\n- Common reform priorities (national priorities differ, but common threads include):\n  - Addressing infrastructure needs\n  - Improving education and addressing skill shortages\n  - Enhancing competition and improving business climate\n\nSweta Saxena, Three Key Questions About the Slowdown in Emerging Markets, September 18, 2014.\n\n---\n\n Content in this bundle\n\n- 2014 Spillover Report: IMF Multilateral Policy Issues Report -- IMF Policy Paper; June 25, 2014\n  - 2014 Spillover Report: IMF Multilateral Policy Issues Report -- IMF Policy Paper; June 25, 2014 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - 2014 Spillover Report: IMF Multilateral Policy Issues Report -- IMF Policy Paper; June 25, 2014 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\n References\n\n- https://www.imf.org/wp-content/uploads/2014/09/ems-chart-1.jpg\n- https://www.imf.org/wp-content/uploads/2014/09/ems-chart-2.jpg\n- https://www.imf.org/wp-content/uploads/2014/09/ems-chart-3.jpg\n\nSource: https://www.imf.org/en/blogs/articles/2014/09/18/three-key-questions-about-the-slowdown-in-emerging-markets"
    }
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    "Authors: Sweta Saxena",
    "Published: September 18, 2014",
    "Yes — they have been slowing down for some time.",
    "GDP growth path:",
    "Revisions to the medium-term outlook have been serially downward since 2010; this pattern of repeated downward revisions is highlighted as unique to the current downturn.",
    "The slowdown is broad based:",
    "Overall assessment: Yes — the slowdown has meaningful spillovers (see the IMF's 2014 Spillover Report).",
    "Expected spillover channels and effects:",
    "Yes — international coordination and policy preparedness are emphasized.",
    "Recommended approaches:",
    "Common reform priorities (national priorities differ, but common threads include):",
    "**2014 Spillover Report: IMF Multilateral Policy Issues Report -- IMF Policy Paper; June 25, 2014**",
    "[https://www.imf.org/wp-content/uploads/2014/09/ems-chart-1.jpg](https://www.imf.org/wp-content/uploads/2014/09/ems-chart-1.jpg)",
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    "[https://www.imf.org/wp-content/uploads/2014/09/ems-chart-3.jpg](https://www.imf.org/wp-content/uploads/2014/09/ems-chart-3.jpg)"
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      "title": "2014 Spillover Report: IMF Multilateral Policy Issues Report -- IMF Policy Paper; June 25, 2014",
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