Emerging countries are also becoming increasingly significant in terms of international trade as they become wealthier and domestic demand rises. The rapid pace of growth in many EM markets is driven by a raft of strong secular trends: improving demographics provide a young and increasingly well-educated, growing workforce; while on the other side of the equation, a rising middle class, specifically in urban areas, will continue to propel strong consumption growth across many markets.
Take the global auto sector for instance. China is already the world’s biggest vehicle market – 2016 saw 28 million new registrations, which was more than the US, Canada and Mexico combined. However, when you also consider China’s appetite in the burgeoning electric vehicles market (a rise of 381% between 2014–2016 in newly registered EVs in China*), it’s clear that EM will play a major role globally as both recipient and producer in such markets.