The economic vitality of emerging economies, which guided the world through the first decade of the twenty-first century, and helped stabilize the west’s financial collapse, has begun to dissipate. “China will be lucky if it manages to hit its official target of 7.5% growth in 2013, a far cry from the double-digit rates that the country had come to expect in the 2000s. Growth in India (around 5%), Brazil and Russia (around 2.5%) is barely half what it was at the height of the boom. Collectively, emerging markets may (just) match last year’s pace of 5%.” It is the slowest emerging-economy expansion in a decade.
What’s the Big Idea?
The west has traditionally promoted its democratic style of government, along with market liberalization, as essential to achieving the scale of economic growth it has enjoyed. “[But f]or the past few years, with China surging, Wall Street crunched, Washington in gridlock and the euro zone committing suicide, the old liberal verities have been questioned: state capitalism and authoritarian modernisation have been in vogue.” As the BRIC nations begin to slow, however, the need for economic growth may rekindle interest in the west’s brand of economic governance.