Emerging market growth has slowed to its weakest pace since the global financial crisis, research firm Capital Economics said on Thursday.
Average growth in emerging Asia, Latin America and emerging Europe slowed to 4 percent year-on-year in the first quarter of this year, according to data from Capital Economics and Thomson Datastream. In comparison, emerging markets grew by an average of 6.4 percent during the past decade.
Gross domestic product (GDP) numbers from April suggest the second quarter could be no better, with all the regions posting slowing or very weak growth.
"Our GDP Tracker suggests that growth weakened again in April, and that the emerging world as a whole is now growing at its slowest pace since the global financial crisis," said Gareth Leather, Asia economist at Capital Economics, in a research note published on Thursday.
The news will come as a blow to economists and policymakers hopeful that emerging markets (EMs) can be the engine of global economic growth and boost anemic demand in the developed world. Indeed, Leather said that some developing economies would themselves be hampered by low global demand.
"The smaller more trade-dependent economies look set to remain weak until there is a meaningful recovery in global demand," he said.
Meanwhile, the slowdown in the biggest emerging markets is more likely due to structural factors, said Leather.
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"Overall, our GDP Tracker provides a reminder that the next year is likely to prove difficult for most EMs, and that a strong and sustained recovery remains some way away," he said.