The violent synchronized sell-off across many emerging markets this summer has served as a rude awakening for policymakers in Asia, in particular. The market correction, at its heart, reflects fears that too many governments have relied on fiscal and credit easing to power above-potential growth in recent years, rather than capitalizing on the era of ample global liquidity to push through structural supply-side measures. From India, Indonesia, China to Vietnam, rising financial imbalances or competitiveness challenges – thanks to inertia over supply-side reforms – blight the growth outlook more than the US Federal Reserve’s shift to a less accommodative policy.
Thanks for your interest in Euromoney!
To unlock this article:
