5 Emerging Economies That Will Change The World

This post originally appeared at The Atlantic.

About 20 years after the Soviet Union collapsed, China opened, India liberalized, and Brazil saved its economy with the Plano Real, and 10 years after a banker at Goldman Sachs labelled them the BRICs, those four economic rising powers have transformed how we think about the developing world. The centuries-old idea that there is an uncrossable gulf between powerful, rich countries and everyone else has been disproven not just by BRICs’ economic power but by their use of that power to help shape world events.

You might say that the glass ceiling has been broken. China, once the “sick man of Asia” and one of the world’s poorest places, now boasts the world’s second-largest economy and may someday soon even surpass the U.S. in wealth. Now that we understand the global hierarchy to be less fixed than it once was, who will rise next? The conditions for a rising power are so complicated and so reliant on outside factors beyond any one country’s control that accurately predicting them would be impossible. Still, some countries seem better positioned and better managed than others. Here are five of our choices for the next emerging economies, plus one outlier that could do well, if only it would pull itself together.

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Turkey

When the Brookings Institute ranked the 10 fastest-growing cities last month, three were Turkish (four were Chinese, but we can't all be China). The country's strong democratic institutions and entrepreneurial culture are driving booms in finance and construction, which are in turn growing cities that could become centres of manufacturing for export to Europe. Even as the rest of the continent declines, Turkish growth is surging; it famously hit 11% last year, surpassing China. And, a century after the end of the Ottoman Empire, the country is renewing its assertive foreign policy in the Middle East and Central Asia, positioning itself as a leader of the Muslim world if (or perhaps when) these regions develop.

Indonesia

The world's fourth-largest country with 238 million people, Indonesia's economy has been growing rapidly since 1997. Unlike China, which depends heavily on exports, Indonesia sells mostly to its own people, meaning that it can better endure the U.S. and European crises. Debt is low, foreign direct investment is high, democratic institutions are young but solid, and the once-troubled country is stable after successfully curbing terrorism. A combination of China-style development and state-run enterprises, Brazil-style good governance, and an India-style rise from poverty means that Indonesia is well positioned to continue rising.

Kazakhstan

Long perceived as a global backwater and a post-Soviet satellite that never quite abandoned such Stalinist ticks as lifelong presidents who build statues of themselves, Kazakhstan is doing better than Borat would have you believe. Filthy rich in resources and sandwiched between China and Russia, the country is well positioned to profit off of Asia's rise, especially as Middle Eastern turmoil makes this sparsely populated and stable country an attractive energy source. The mostly benevolent government is investing the revenue wisely, growing infrastructure and non-energy industries such as transportation and pharmaceuticals, while still avoiding overheating. As long as Asia grows, so will Kazakhstan.

Democratic Republic of the Congo

Corruption and war have made 'Congo' synonymous with disaster, and while the country is still deeply troubled, it's also making significant progress toward realising its enormous economic potential. The Congolese mineral trade is fueling urbanization, a small but important middle class, infrastructure development, and a nascent telecommunications industry. If the country can hold on to political stability, there's little reason to think its recent years of eye-popping growth won't continue. Developing sufficient transportation infrastructure to make its agriculture more widely competitive could give the DRC's growth real longevity.

Mexico

The case for Mexico is cut-and-dry. It is the 12th largest economy in the world, growing at its healthiest pace in a decade. Three out of every four export dollars comes from the United States, which distinguishes Mexico from developing countries like Turkey, which rely on the sick euro zone to buy most of its exports. Mexico's trade comes from a blend of manufactured goods and natural resources, which makes it well-positioned to withstand fluctuations in commodity prices. The Brookings Metropolitan Policy program recently named Mexico City one of the most economically vibrant cities in the world, based on employment and income growth. (This slide written by Derek Thompson.)

Nigeria (Maybe)

Nigeria should be at the top of this list. It is by far Africa's most populous country, its most oil-rich after Libya, and could soon hit double-digit growth . Nigerian demography and geography make it a great candidate for economic success. But the Nigerian government, beset by corruption and an increasingly rebellious northern half (that should maybe be a different country entirely ), is managing its resources poorly. Though Nigeria's economy is booming, its absolute poverty rate has risen to 69% , with income inequality so bad it's inspired a national protest movement. Inflation is expected to rise, further squeezing the middle class. Nigeria has all the right ingredients for BRIC-style growth, and it may one day put them together, but for now even its booming energy sector can't promise economic security.

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