The Boao Forum for Asia released the first annual report on the development of emerging economies and defined the concept of E11 (11 emerging economies) in 2010. E11 refers to 11 major emerging market economies in the G20 Group, namely, Argentina, Brazil, China, India, Indonesia, South Korea, Mexico, Russia, Saudi Arabia, South Africa and Turkey.
The 2013 Report introduces and compares the basic social and economic conditions of the E11 economies and their overall performance and changes in their international ranking. It also analyses the development of and changes in the economic and trade links among the E11 and between the E11 and developed economies before reviewing and analysing recent economic situation and policies of the E11 economies. Based on the above analyses, the overview of this report summarizes the development characteristics of the E11 Economies in the past year and looks into their overall development in 2012.
The 2012 Report points out that the domestic economy and external economic and trade links of the E11 mainly have the following features in 2011: First, their economic scale has been expanding continually, which resulted in their improved economic prowess. According to the IMF estimates, in terms of economic scale, in 2011, the PPP-based GDP of the E11 would total 27.81 trillion international dollars, accounting for 35.3 percent of the global total, 1.1 percentage points higher than that in 2010, while the market exchange rate-based GDP of those economies would reach $18.6 trillion, accounting for 26.6 percent of the global total, 1.5 percentage points higher than that in 2010.
Second, economic recovery of the E11 was obviously slowing down, with varied performances in different economies. According to the IMF estimates, in 2011, the real GDP growth rate of the E112 was 7.2 percent, 1.2 percentage points down from the 8.4 percent in 2010. Among the E11 economies, China had the best economic performance in 2011, when its economy expanded by 9.2 percent, while Brazil, whose economy expanded by 2.9 percent, had the lowest growth rate among those economies, 6.3 percentage points lower than that of China, the fastest-growing economy in the E11.
Third, trade growth of the E11 economies slowed. In 2010, the E11 economies saw their external trade recover rapidly and their weighted nominal export and import growth rate reached 30.6 percent and 35.0 percent, respectively. In the first half of 2011, the foreign trade volume of the E11 reached $3.37 trillion, up 26.9 percent year-on-year but the growth rate was lower than that in 2010. The weighted nominal growth rate of export and import was 26.4 percent and 27.4 percent, respectively.
Fourth, the internal trade links of the E11 continued to strengthen while their trade dependency on the developed economies continued to be on the decline. In the first half of 2011, the internal trade among the E11 economies amounted to $780 billion, up 28.8 percent year-on-year and 1.9 percentage points higher than their foreign trade growth; exports of the E11 to the US, EU and Japan totaled $960 billion and their imports from the three major economies reached $760 billion, up 22.08 percent and 26.79 percent, respectively, both lower than the global performance of the E11, and the three major economies of the US, EU and Japan accounted for 40.10 percent of the E11's trade volume, 2.09 percentage points lower than that in 2009.
The 2012 Report also points out that the emerging economies represented by the E11 will face many uncertainties in 2012. They mainly include:
1. The continued economic doldrums in the developed economies could possibly lead to further weakening of global demand, which would affect the sustainable and stable growth of the E11.
2. Some economies may continue to face high jobless rate and it is also possible for consumer prices to rebound. The need to strike a balance between job creation and growth and inflation management makes it more difficult for those economies to adjust their macroeconomic policies.
3. As trade relations become closer, some economies may suffer from increasing trade frictions, which would become a hot issue to aect their development of trade relation.
4. As the global financial markets are getting increasingly intertwined, where the debt crisis in the developed economies is heading for will become an important factor behind the uncertain prospects of the financial markets in the emerging economies.
Due to the many uncertainties in the economic recovery of the E11 and based on the description and analysis of the development of the emerging economies, this report holds that in the first half of 2012, the overall economic slow-down of the E11 will worsen but can stabilize in the second half of the year. The whole-year growth is expected to be about 6.7 percent. China's economic growth is expected to be about 8.8 percent while that of Brazil can be 4.0 percent. That of India and Russia will be about 7.5 percent and 3.8 percent, respectively. Although the possibility of China encountering an economic hard landing is slim, the possibility of some other economies suffering from hard landing cannot be ruled out. Regarding economic cooperation, since the E11 economies continue to maintain fast growth, their trade and investment links will continue to grow and their dependence on the developed economies will continue to decline. Moreover, international cooperation of the E11 economies may see some breakthroughs in some major fields, and in particular, the BRICS (Brazil, Russia, India, China and South Africa) may possibly take new measures to promote trade, investment and financial cooperation among them.