Two-speed global recovery likely to continue in 2011
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Two-speed global recovery likely to continue in 2011

Friday, 31 December 2010, 12:41 Hrs   |    1 Comments
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Washington: International Monetary Fund has said that the world economy is likely to see a "two-speed" recovery in 2011 with emerging markets witnessing stronger growth than advanced economies.

Some emerging nations like India and China, however, are also facing the challenges of huge capital inflows and overheating.

The global economy, which grew nearly five per cent this year, is being driven by good expansion in emerging countries while many advanced nations continue to grapple with sluggish economic activities.

"The two-speed global economic recovery is likely to dominate 2011," IMF's Chief Economist Olivier Blanchard said.

According to him, weak growth in advanced economies is barely enough to bring down unemployment and emerging markets face the challenges of success, including how to avoid overheating and handle strong capital inflows.

For instance, India has alone seen Foreign Institutional Investors investing more than USD 40 billion this year.
Source: PTI
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Reader's comments(1)
1: This does not come as a surprise, does it? If we take a look at the spend trend in emerging economies, it has been 3-4% higher than in the developed nations. Many factors come into play here - consumers, purchasing power, inflation, economic growth, lifestyle and marketing strategies of the companies. IPhone 4 (the best cell phone out in the global market) was not launched anywhere except in US & UK and after almost 6 months of its launch, it's still not available anywhere apart from the locations I mentioned before. Apple has its marketing strategy in place and a lot of work has gone into it I am sure and neither will I question it because I can see their vision. Not to indulge into controversial statements, many companies have started targeting emerging economic nations as their consumer bases. The reason is simple, we are influenced with the lifestyle of developed nations and are crazy towards adopting it. Give those products to us and we will buy them, no matter it hurts our pocket. Jokes apart. Emerging economies like India and China would eventually find a way to deal with problems of strong inflow of capital as well as overheating. But developed nations need to keep an eye out for their strategies in future. For the saying is - Watch your step, lest you fall...
Posted by:Amit Upadhyay - 01 Jan, 2011