Washington: With the rapid growth of emerging economies and developing countries, the world has become more intertwined and the global economic map is undergoing some fundamental changes, Zhu Min, deputy managing director of the International Monetary Fund (IMF), said here.
Emerging economies have posted faster growth than advanced economies in recent years and now account for an increasingly bigger share of the global economic output, Zhu said Tuesday at an event hosted by the Paul H. Nitze School of Advanced International Studies (SAIS) under Johns Hopkins University in Washington, D.C., reported Xinhua.
Developing countries are also making an increasingly important contribution to the global consumption and trade growth, leading to the "shifting global gravity", Zhu told a group of experts, students and media representatives.
However, compared with the US, emerging economies like China still only account for a very small share of the global financial transactions in terms of their external assets and liabilities in the global total volume. Advanced economies like the US can have a much bigger spillover effect on the rest of the world through the financial links, he noted.
Due to the "hyper-connectivity" of the financial markets and trade of different countries, global coordination has become more important than ever, Zhu observed.
Advanced economies like the eurozone are confronted with the "tough issue" of de-leveraging debts and bolstering economic growth, as their public debt to gross domestic product ratios have reached an alarmingly high level, the economist warned.