Bright future ahead for emerging nations

Watching the increasing influence of the emerging economies on the global stage seems to give Carlos Magarinos as much pleasure as listening to his favorite jazz music.

"For the first time this year, emerging economies contributed over half of the world's GDP in purchasing power terms," says Magarinos, 52, former director-general of the United Nations Industrial Development Organization.

"The emerging economies will continue to provide two-thirds of global growth despite less dynamic performance in a more demanding financial context," says Magarinos, the honorary global chairman of the Global Alliance of Small and Medium Enterprises, based in Shanghai.

This trend seems to follow a set pattern, with a leading role for Asian economies in general and China in particular, which is both the result of and the catalyst for the emergence of a new global middle class, he says.

"By 2020 the global middle class will have grown to 1,400 million people, most living in Asia. The spending capacity of this new global middle class will experience a significant boost."

Magarinos was speaking in the lobby of the Shangri-La hotel in the Haidian district of Beijing, after a two-day conference held by Renmin University of China relating to G20 and global growth, one of those attending being former US president Jimmy Carter.

Magarinos, senior fellow at Chongyan Institute for Financial Studies of Renmin University of China, says there are many opportunities for emerging economies to adopt new roles and responsibilities.

"In the years to come, the quality of domestic policy will be more relevant for the emerging economies than before, as will their performance for the global economy, which will rely more heavily on the quality of their economic strategies."

In that sense. emerging economies will face a future quite different to the exceptional period they have lived through over the past decade, he says.

"Then, thanks to the growth of China, in particular, and Asia in general, almost every emerging or developing economy, whether with progressive or conservative governments, large or small, with good or less good economic policies, grew at an impressive rate."

Although policy concerns may differ among emerging economies, they share common challenges, he says.

"Exchange rate flexibility should be preserved in order to address effectively changing fundamentals and face external adjustment along with foreign exchange interventions to soften the effects of financial volatility. Fiscal balances should be improved and debt levels should be kept in check."

Magarinos has almost 30 years' experience in trade and industry, environment and international relations.

In 1993, at age 30, he was appointed state secretary of industry and mining of Argentina, the youngest person to be appointed to that post.

From 1993 to 1996 he worked to implement an economic reform program that brought down inflation, raised productivity and ultimately led to sustained economic growth in Argentina.

In 1996 he was appointed economic and trade representative to Washington, with the rank of ambassador and state secretary.

From 1997 to 2005 he served as director-general of the UNIDO, becoming the first Argentine to lead a UN agency.

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