‘Emerging economies will drive global growth’

September 26th, 2008 - 2:01 pm ICT by IANS  

Rio de Janeiro , Sep 26 (Xinhua) A new world financial order may emerge from the current global financial crisis in which developing countries will play a central role, Brazil’s finance minister Guido Mantega has said.”Developed countries are less prepared to face the crisis, with their low GDP growth, stagnant domestic market and a financial system contaminated by rotten assets,” Mantega said Thursday.

the Brazilian minister said the emerging economies are dynamic as “their GDP is expanding, the domestic market is growing and the financial system is in a sound condition.”

The developing countries therefore are most likely to be the engine of global economic growth in the decades to come, he said.

The minister praised the proposed US financial bailout plan, saying the measures were correct and necessary, blaming the crisis on the high leverage of US banks.

“What makes the Brazilian financial system strong is that we have correct rules,” he said. “leverage here is controlled.”

Mantega said Brazil’s GDP is expected to grow 5.5 percent in 2008, up from 5 percent last year, and growth may slow to 4.5 percent in 2009, still higher than estimated global growth.

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