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The term emerging markets is used to describe a nation's social or business activity in the process of rapid growth and industrialization. Currently, there are approximately 28 emerging markets in the world, with the economies of China and India considered to be by far the two largest.[1] According to The Economist many people find the term dated, but a new term has yet to gain much traction.[2]

The ASEAN–China Free Trade Area, launched on January 1, 2010, is the largest regional emerging market in the world.[3]



      Developing countries that are neither part of the least developed countries, nor of the newly industrialized countries

Originally brought into fashion in the 1980s by then World Bank economist Antoine van Agtmael,[4] the term is sometimes loosely used as a replacement for emerging economies, but really signifies a business phenomenon that is not fully described by or constrained to geography or economic strength; such countries are considered to be in a transitional phase between developing and developed status. Examples of emerging markets include China[5], India, some countries of Latin America (particularly Argentina, Brazil[6], Chile, and Mexico), some countries in Southeast Asia, most countries in Eastern Europe, Russia, some countries in the Middle East (particularly in the Persian Gulf Arab States), and parts of Africa (particularly South Africa). Emphasizing the fluid nature of the category, political scientist Ian Bremmer defines an emerging market as "a country where politics matters at least as much as economics to the markets."[7]

The research on emerging markets is diffused within management literature. While researchers including C. K. Prahalad, George Haley, Hernando de Soto, Usha Haley, and several professors from Harvard Business School and Yale School of Management have described activity in countries such as India and China, how a market emerges is little understood.

In the 2008 Emerging Economy Report[8] the Center for Knowledge Societies defines Emerging Economies as those "regions of the world that are experiencing rapid informationalization under conditions of limited or partial industrialization." It appears that emerging markets lie at the intersection of non-traditional user behavior, the rise of new user groups and community adoption of products and services, and innovations in product technologies and platforms.

The term "rapidly developing economies" is being used to denote emerging markets such as The United Arab Emirates, Chile and Malaysia that are undergoing rapid growth.

In recent years, new terms have emerged to describe the largest developing countries such as BRIC that stands for Brazil, China, India and Russia, along with BRICS (BRIC + South Africa), BRICM (BRIC + Mexico) and BRICK (BRIC + South Korea). These countries do not share any common agenda, but some experts believe that they are enjoying an increasing role in the world economy and on political platforms.

A large number of research works are in progress at leading universities and business schools to study and understand various aspects of Emerging Markets.

It is difficult to make an exact list of emerging (or developed) markets; the best guides tend to be investment information sources like ISI Emerging Markets and The Economist or market index makers (such as Morgan Stanley Capital International). These sources are well-informed, but the nature of investment information sources leads to two potential problems. One is an element of historicity; markets may be maintained in an index for continuity, even if the countries have since developed past the emerging market phase. Possible examples of this are Israel,[9] South Korea,[9] and Taiwan. A second is the simplification inherent in making an index; small countries, or countries with limited market liquidity are often not considered, with their larger neighbours considered an appropriate stand-in.

The Big Emerging Market (BEM) economies are Brazil, China, Egypt, India, Indonesia, Mexico, Philippines, Poland, Russia, South Africa, South Korea,[9] and Turkey.[10]

Newly industrialized countries are emerging markets whose economies have not yet reached first world status but have, in a macroeconomic sense, outpaced their developing counterparts.

FTSE emerging markets list

The FTSE Group distinguishes between Advanced and Secondary Emerging markets on the basis of their national income and the development of their market infrastructure. The Advanced Emerging markets are classified as such because they are Upper Middle Income GNI countries with advanced market infrastructures or High Income GNI countries with lesser developed market infrastructures. [11][12]

The Advanced Emerging markets are:  Brazil,  Hungary,  Mexico,  Poland,  South Africa,  Taiwan.[13]

The Secondary Emerging markets are some Upper Middle, Lower Middle and Low Income GNI countries with reasonable market infrastructures and significant size and some Upper Middle Income GNI countries with lesser developed market infrastructures.

The Secondary Emerging markets are:  Argentina,[14]  Chile,  China,  Colombia,[15]  Czech Republic,[16]  Egypt,  India,  Indonesia,  Malaysia,[16]  Morocco,  Pakistan,  Peru,  Philippines,  Romania,  Russia,  Thailand,  Turkey.[16]

MSCI list

As of April 2009, MSCI Barra classified the following 22 countries as emerging markets:[18]

The list tracked by The Economist is the same, except with Hong Kong, Singapore and Saudi Arabia included (MSCI classifies the first two as Developed Markets)

See also


  1. ^ "Emerging Economies and the Transformation of International Business" By Subhash Chandra Jain. Edward Elgar Publishing, 2006 p.384
  2. ^ "Acronyms BRIC out all over". The Economist. September 18, 2008.   Retrieved on September 21, 2008.
  3. ^ China-ASEAN FTA prompts growing trade among border cities
  4. ^ / Columnists / John Authers - The Long View: How adventurous are emerging markets?
  5. ^ Five Years of China’s WTO Membership. EU and US Perspectives on China’s Compliance with Transparency Commitments and the Transitional Review Mechanism, Legal Issues of Economic Integration, Kluwer Law International, Volume 33, Number 3, pp. 263-304, 2006. by Paolo Farah
  6. ^ Alternative Stock Library / Looking for Escape? Go Brazil!
  7. ^ [1]
  8. ^ Emerging Economy Report
  9. ^ a b c Classified by FTSE as a developed market.
  10. ^ Yale University Library: Emerging Markets - The Big Ten Countries
  11. ^ See FTSE Country Classification, September 2009
  12. ^
  13. ^ Possible change to Developed.
  14. ^ To be moved to Frontier September 2010. See:
  15. ^ Possible change to Frontier.
  16. ^ a b c Possible change to Advanced Emerging.
  17. ^
  18. ^ MSCI International Equity Indices
  19. ^ Will be classified also by MSCI as a developed market in the May 2010 Semi-Annual Index Review. See: MSCI Market Classification Decisions, June 15 2009, bottom of p. 1.


  • Goldman Sachs Paper No.134 BRIMC (English)
  • Michael Pettis, The Volatility Machine: Emerging Economies and the Threat of Financial Collapse (2001) ISBN 0-19-514330-2

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