growth estimates for emerging economies at the start of 2024 have improved slightly
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Growth estimates for emerging economies at the beginning of 2024 have improved slightly, according to a review by S&P Global. This is largely due to expectations that the Fed and ECB will begin easing monetary policy by the middle of this year. Let us remember that, given the continuing slowdown in inflation and the decline in business activity, this scenario looks most likely (for more details, see, for example, Kommersant on April 4).
It is also expected that central banks of developing countries, which have already begun to cut rates (we are talking primarily about Latin American countries), will continue to do so. Those who have not yet started easing monetary policy (mainly Asian economies) will also do so in 2024, but most likely in the second half.
An additional impetus to the GDP dynamics of some developing countries, as S&P Global analysts expect, will be given by the steady economic growth of the United States: its prospects in 2024 are now estimated at 2.5%, as in the past (the previous review assumed an increase in US GDP of only 1.5% ). The forecast for the euro area economy remains unchanged: as at the end of 2023, analysts expect European GDP to grow by only 0.7% this year (0.5% in 2023).
A logical consequence of this is a forecast suggesting that developing countries dependent on the American economy will demonstrate greater resilience in 2024 than states focused on strengthening ties with euro area countries. It is this assumption that underlies the main conclusion of the latest review: the growth trajectories of emerging economies this year will differ even more markedly than in the past. However, the dynamics of each specific country will, of course, be influenced by a wider set of indicators: including the level of political uncertainty and budgetary stimulus.
As a result, analysts predict that GDP growth rates may accelerate in Thailand (3.9% in 2024 after 1.9% in 2023, see also Kommersant on April 2) and Vietnam (6.1% after 5%), as well as in Poland (2.8% after 0.2%) and Hungary (2.2% after -0.7%) – we remind you that S&P also classifies them as developing. The Chinese economy this year may increase by 4.6% (5.2% last year), the Indian economy by 6.8% (7.6%), analysts believe.
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