DEVELOPING AND EMERGING ECONOMIES

DEVELOPING COUNTRIES / MARKETS

A developing country is a country with a less developed industrial base and a low Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreement on which countries fit this category. The term low and middle-income country (LMIC) is often used interchangeably but refers only to the economy of the countries. The World Bank classifies the world's economies into four groups, based on Gross National Income per capita: high, upper-middle, lower-middle, and low income countries.

EMERGING COUNTRIES / MARKETS

An emerging market is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were in the past.

An emerging market economy is the economy of a developing nation that is becoming more engaged with global markets as it grows. Countries classified as emerging market economies are those with some, but not all, of the characteristics of a developed market.

• An emerging market economy is an economy that is in the process of becoming a developed economy.
• Emerging market economies typically feature a unified currency, stock market, and backing system, and are in the process of industrializing.
• Emerging market economies can offer greater returns to investors due to rapid growth, but also offer greater exposure to some inherent risks due to their status.

 

DIFFERENCE BETWEEN EMERGING COUNTRIES AND DEVELOPING COUNTRIES

The fundamental difference between these classifications is that emerging nations are growing rapidly and becoming more important in world economics, while developing nations are struggling and still need help from trade partners around the world.

Developing countries that qualify as emerging markets – include Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Pakistan, Peru, Philippines, Poland, Qatar, Russia, South Africa, Taiwan, Thailand, Turkey.