## The Next Move: Consequences for Emerging Markets

_IMF Blog, June 2, 2021_

## Source details

**Canonical URL:** [The Next Move: Consequences for Emerging Markets](https://www.imf.org/en/blogs/articles/2021/06/02/the-next-move-consequences-for-emerging-markets)

## Other formats

- [Markdown version](/en/blogs/articles/2021/06/02/the-next-move-consequences-for-emerging-markets/index.md)
- [Structured JSON version](/en/blogs/articles/2021/06/02/the-next-move-consequences-for-emerging-markets/index.json)
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## Bibliographic details
- Authors: Gita Bhatt
- Published: June 2, 2021

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### Overview and framing
- Publication: Finance & Development issue focused on emerging markets.
- Author: Gita Bhatt.
- Date: June 2, 2021.
- Definition emphasis: "emerging markets" as economies in the middle—neither advanced nor low-income—characterized by widely diverse sizes and growth rates and growing systemic relevance that helps anchor global stability.
- Core observation: multispeed economic recovery within and across countries, sectors, age groups, genders, and skill levels.

### Key assessments and perspectives
- Recovery trajectories:
  - Some countries, exemplified by China, "have managed to emerge quickly from the present crisis."
  - Others "may struggle for years to deal with the pandemic’s aftereffects."
- Expert contributions highlighted in the issue:
  - Rupa Duttagupta and Ceyla Pazarbasioglu: stock-taking with focus on debt, economic policy trade-offs, and priorities for stronger growth.
  - Richard House and David Lubin (investors): analysis of how emerging market assets have fared during the pandemic and reasons they are unlikely to suffer systemic crises as in the 1980s and 1990s.
  - Şebnem Kalemli-Özcan: warns of potential for greater turbulence as US interest rates rise.
  - Francisco Ferreira: finds the pandemic’s effect on inequality is "manifested in counterintuitive ways, depending on how you measure it."
  - Jim O’Neill: revisits the diverging fortunes of Brazil, Russia, India, and China, "20 years after coining the acronym 'BRICs'."

### Main findings and implications
- Heterogeneous outcomes:
  - Emerging markets face differing prospects, priorities, and challenges due to diversity in size and growth.
- Systemic importance:
  - Group’s growing systemic relevance contributes to global stability, but vulnerabilities remain.
- Inequality:
  - The pandemic’s impact on inequality is complex and measurement-dependent.
- Financial stability risks:
  - Investor views signal lower risk of systemic crises similar to the 1980s and 1990s, though rising US interest rates could increase turbulence for some economies.

### Policy recommendations and priorities
- Immediate priority:
  - "Procuring, producing and distributing vaccines to end this pandemic."
- Policy strategies for stronger, more inclusive growth:
  - Well-calibrated economic policies that improve access to health care and education.
  - Help create jobs and support and retrain displaced workers.
  - Strengthen public investment in green projects and digital infrastructure.
- Overarching goal:
  - Build more inclusive economies that benefit everyone while ensuring macroeconomic stability.

### Strategic metaphor and call to action
- As in a chess game, every move by leaders and policymakers has consequences; the piece argues "Let them be the right ones."

*Source: The Next Move: Consequences for Emerging Markets — Finance & Development, June 2, 2021.*

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## References

- [this issue](https://www.imf.org/external/pubs/ft/fandd/)
- [China](https://www.imf.org/external/pubs/ft/fandd/2021/06/the-future-of-china-dollar-huang-yao.htm)
- [struggle for years](https://www.imf.org/external/pubs/ft/fandd/2021/06/employment-growth-emerging-markets-lanau.htm)
- [take stock](https://www.imf.org/external/pubs/ft/fandd/2021/06/the-future-of-emerging-markets-duttagupta-and-pazarbasioglu.htm)
- [discuss how emerging market assets](https://www.imf.org/external/pubs/ft/fandd/2021/06/emerging-markets-in-flux-pradhan-house-lubin.htm)
- [greater turbulence as US interest rates rise](https://www.imf.org/external/pubs/ft/fandd/2021/06/federal-reserve-emerging-markets-private-debt-kalemli-ozcan.htm)
- [pandemic’s effect on inequality](https://www.imf.org/external/pubs/ft/fandd/2021/06/inequality-and-covid-19-ferreira.htm)
- [diverging fortunes of Brazil, Russia, India, and China](https://www.imf.org/external/pubs/ft/fandd/2021/06/jim-oneill-revisits-brics-emerging-markets.htm)
- [build more inclusive economies that benefit everyone](https://www.imf.org/external/pubs/ft/fandd/2021/06/what-we-owe-each-other-book-minouche-shafik.htm)
- [https://www.imf.org/external/pubs/ft/fandd/index.htm](https://www.imf.org/external/pubs/ft/fandd/index.htm)

_Source: https://www.imf.org/en/blogs/articles/2021/06/02/the-next-move-consequences-for-emerging-markets_