||Bangladesh Among New-wave Economies to Overtake West by 2050 Forecast
||Saturday, December 22, 2012
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||Dec 25, 2012
DHAKA: A forecast on global economies published by The Guardian newspaper said that trends shows that Bangladesh was among the countries whose economy might overtake the Western countries by 2050.
“As even Brics plateau(a grouping acronym of Brazil, Russia, India and China), other countries, from Bangladesh to Mexico, are coming up fast - and could overtake the west by 2050,” said the report published last week.
The report pointed out that Bangladesh has been helped by remittances sent home from expatriates working overseas.
In anticipation, the Guardian launched a three-day series throwing the spotlight on several of these fast-growing countries like Bangladesh, Pakistan, Vietnam, Philippines, Indonesia, Turkey, Egypt, Iran, South Korea, Mexico, Argentina and South Africa including the famed Brics.
According to the report, these countries are big. “They have young and growing populations. They have invested in infrastructure and education. And they are growing at the sort of rates that make them the envy of the recession-hobbled west.”
No, these are not the famed Brics – the big emerging market economies of which much has been heard since the acronym was first coined by Jim O'Neill of Goldman Sachs more than a decade ago. Rather, they are a second wave of countries – some Asian, some Latin American, some African – coming up fast behind.
As the west remains mired in gloom and even the Brics start to plateau, attention is turning to this group of countries, many of which not so long ago were rudely dismissed as basket cases. Acronyms are hard to coin, as few of them start with a vowel.
But when growth rates for 2013 are chalked up, these are the countries that will dominate the top 20. In anticipation, the Guardian is launching a three-day series throwing the spotlight on several of these fast-growing countries.
The changing face of the global economy is reflected in the rapidly expanding scale of the summits designed to sort out its problems. Not so long ago, when 80% of global GDP was accounted for by Europe, North America and Japan, it was the G7 that was the forum that counted.
By the middle of the 2000s it became impossible to discuss the future of the world economy without the presence of China and India, and when a second great depression loomed in late 2008 the G20 was formed. This included not just the G8 and the Brics but a sprinkling of the more strategically important emerging economies, such as Indonesia, Turkey, South Korea, Mexico, Argentina and South Africa.
While some emerging countries, such as Vietnam, have been hard hit by falling western demand for their exports since the financial crisis of 2007-08, others have been sustaining strong growth rates.
Bangladesh and the Philippines have been helped by remittances sent home from expatriates working overseas. Nigeria has been a beneficiary of the global commodity boom that has seen the cost of a barrel of Brent crude oil remain above $100 a barrel. Mexico and Indonesia have generated strong domestic demand from their large populations.
John Hawksworth, chief economist at PricewaterhouseCoopers (PwC), said: "There are countries beyond the Brics that have quite strong long-term growth potential."
Back in 2006, PwC made some long-term forecasts about what the global economy might look like in 2050, and it has now updated the predictions in the light of the financial crisis and its aftermath.
By 2050, Hawksworth expects Turkey's economy to be bigger than Italy's, and one of the largest in Europe. Indonesia and Mexico will have outstripped Germany and the UK.
O'Neill, when he identified his "Next 11" group as the successors to the Brics, chose many of the most populous countries in the world for his list: Bangladesh, Egypt, Indonesia, Iran, South Korea, Mexico, Nigeria, Pakistan, the Philippines, Turkey and Vietnam.
"Some of these emerging countries have good demographics, based on a growing and younger population than countries in the west," Hawksworth said.
"They have a lot of potential for catch-up as long as they have broadly growth-friendly policies – a big if in some cases. They have the potential to absorb technology from overseas and can get rapid growth.
It doesn't mean all will achieve it but a fair few will." He drew a comparison between South and North Korea, saying one of the world's last bastions of communism was an example of what happened to countries that cut themselves off.
HSBC has cut its growth forecast for 2013 because of the impact of collapsing world trade on those emerging markets that have based their development on export growth.
But in the longer term, there is optimism even for what has up until now been the world's slowest-growing continent: Africa.