Emerging nations are the leaders of global economic recovery as emerging markets growth hits a two-year high, according to the latest HSBC Emerging Markets Index.
The index rose to 56.1 in the last quarter of 2009, up from a low of 43.8 in the same quarter of the previous year.
“The data shows that the trend we first identified in October 2009 is gaining momentum — emerging nations are going from strength to strength and a global recovery is likely to be emerging markets-led,” said HSBC chief economist Stephen King.
“Drivers of the global economy continue to shift to the East and we are seeing emerging nations becoming increasingly dependent on each other rather than on the economies of developed countries.”
The data showed manufacturing exports had the largest gain in the fourth quarter, with the increase in export orders the largest since the first quarter of 2005. Manufacturing and services output surged in the final quarter of 2009 at the fastest rate since the final quarter of 2007.
The index revealed that Chinese demand for commodities and other goods was seen to bolster the export earnings of other emerging nations, providing commodity-producing countries with a buffer against volatility in Western nations.
“The surge of economic activity in emerging markets bodes well for the Australian economy in 2010,” said HSBC senior Asia economist Frederic Neumann.
“The continued demand for raw materials from emerging markets will help underpin Australia’s ongoing export boom, providing a critical boost to the overall economy,” he added.
He said leading indicators pointed to an ongoing acceleration of growth in China.
“With the Chinese still ramping up demand, both local investment in the resource sector and shipments overseas will bolster the Australian economy and support economic growth.”
