Emerging markets to lead global development: IMF official

Want China Times, Xinhua 2013-09-14

Zhu Min at the Summer Davos forum in Dalian, Sept. 12. (Photo/Xinhua)

Emerging markets will lead global development and contribute to more than 80% of growth in the coming years, IMF deputy managing director Zhu Min said Thursday.

During a session at the ongoing 2013 Summer Davos Forum in northeast China's Dalian, Zhu told reporters that the US Federal Reserve's impending stimulus withdrawal will undoubtedly trigger widespread global volatility, but the emerging market is not likely to see a crisis.

His comments came after worries about the US reduction of the US$85-billion dollar bond-buying program sent jitters to some emerging markets such as India and Indonesia, prompting concerns of another financial crisis.

Zhu said compared with five years ago, these markets are now better positioned to cope with the possible shock, citing an improving macro environment, lower debt levels, increasing currency reserves as factors to cushion the blow.

He also urged the Federal Reserve to enhance policy transparency and carefully choose the timing of the scale-back to allow emerging markets to be better prepared.

Li Daokui, director of the Center for China in the World Economy at Tsinghua University in Beijing, echoed Zhu's view, saying the impact of the tapering move, which depends on the fundamentals of the economies, will be more diversified.

He believed China can weather through the phase as it has a bigger buffer of currency reserves.

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