With the merging of globalisation and ‘glocalisation’, the gap of economic growth between developed and emerging countries is diminishing substantially. The G7 nation’s total GDP in 2000 was 133% of that of the EAGLEs (Emerging and Growth Leading Economies). In 2016, the EAGLEs leapfrogged the growth by 128% of the G7’s. If the trend continues, this figure will hit 138% in 2020 and the projected GDP growth of the EAGLEs will outperform that of the G7 by two times within 2050 (G7 – US$bn 73,787 vs E7 – US$bn 145,349).
The EAGLEs are producing a significant contribution to the world economy; it is considered as of utmost importance for foreign investment and global market for innovation. The E7 countries are the front-runners of global economies and the EAGLEs are considered as the next frontier economies.
The EAGLEs were lucrative destinations for foreign investment and innovation portfolios in the last decade and things are shifting yet further as more developed regions are changing traditional labour-intensive manufacturing scenarios – with manufacturing plants, design & research hubs being shifted to these EAGLE countries for Greenfield investment.
Governments and corporations are finding it beginning to take advantage of the availability of more economic cost effective labour from these emerging markets. Investors are now finding the EAGLEs’ healthy growth and manageable fiscal deficit more business-friendly.
But low-income bracket and high rate of unemployment pose great challenges to these economies. The EAGLEs are now hitting the ‘sweet spot’ of consumer growth after 2017 for the people earning more than US$10 per day. Additional threats come as structural problems and comparatively expensive market trading especially in the Latin America. The Asian countries are facing the challenges of authoritarian government, political instability, terrorism and technological adaptation between fourth industrial revolution and innovation.
To encourage the booming economic growth of the EAGLEs, the developing countries should help identify the determinants of external shock that may undermine the potential growth. Profound, lasting transformation in the global economy is achievable through craftsmanship of the developing and emerging countries. The monumental shift of this world economy can achieve a steady and balanced momentum if market liberalisation, political stability and infrastructural and institutional support are ensured. In addition, moving beyond the boundaries can help the challenged global economy stay afloat. Meanwhile, corporations and governments capable of meeting the interests of the Western democracies need to effectively supply optimum business, and conducive regulatory environment to the new bourgeois of Asia, Africa, and beyond – so that the EAGLEs can move to the next level of economic advancement.