A World Bank report shows that 17 of the G20 countries have recently set up trade barriers. This is known as "protectionism" or restrictions on trade between states, which heavily harms exports industries. And some emerging markets will be more vulnerable to this than others.
The chart below shows exports as a percentage of GDP for a selection of main emerging economies. You can see that exports equal a whopping 80% of GDP in both the Czech Republic and Hungary. Over half of these are shipped to its main trading partner - the recession-stricken eurozone.
Taiwan is next on the list - exports here account for 60% of GDP. By contrast, exports account for just under 15% of GDP in Brazil, and India is at approx. 22%.
Export-heavy countries are higher risk...
Source: Capital Economics/Thomson Datastream
If protectionism starts to grow, countries that are export-heavy will get hit harder and have the most to lose. However, nations such as India and Brazil that are less export-dependent will have reduced exposure. They are less vulnerable to falling global exports demand and trade restrictions.
So for exposure to rapid growth, emerging economies such as Brazil and India remain the places to look.
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