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Oct 24, 2011 5:00:00 PM Last Updated

EMERGING MARKETS QUARTERLY

Emerging Markets ChartbookBy the RGE Economic Research Team

Figure 1: Eports to U.S. and EZ (% of GDP, 2010)

Soce: UN, naional aiic, Hae, RGE

Emerging Asia and Eastern Europe are the most exposed to a recession in the eurozone (EZ) and/or U.S.

Figure 2: Eternal Debt (% of GDP)


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Source: National statistics, Haver, RGE

The eenal deb of Eaen Eope fa oeigh ha of ohe emeging make (EM), leaing i moe

epoed o a financial hock and cenc depeciaion.

Figure 3: Eternal Vulnerabilit Indicator (2011 forecast)

Source: Moodys

Eenal lneabili indicao = (ho-em eenal deb + cenl maing long-em eenal deb +

oal noneiden depoi oe one ea)/official foeign eee.

Figure 4: European Bank Claims as a Share of FX Reserve s


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Source: BIS, IMF, RGE

Not surprisingly, Eastern Europes exposure to European banks is the highest.

Fige 5: Financial Openne (Chinn-Io, 2009)

Source: Menie D. Chinn and Hiro Ito

In this index, closed capital accounts have negative values. The index is derived from the restrictions on

cross-border financial transactions data reported in the IMF's Annual Report on Exchange Arrangements

and Exchange Restrictions.

Fige 6: Ce n Accon (% of GDP, ailing 12 monh ending in Jne 2011)


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Soce: Naional aiic, Hae, RGE

Asias large surpluses should shield it from any external financing shocks, while once again Eastern Europe

looks vulnerable, even though deficits have narrowed since 2007.

Fige 7: FDI Coeage of Cen Accon Defici (12 monh o Jne 2011)

Soce: Naional aiic, Hae, RGE

The financing of Latin American current account deficits is generally better than those in emerging Europe

or Africa.


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Figure 8: Net Portfolio Flows (% of GDP, most recent 12 months)

Soce: Hae, naional aiic, RGE

Conie like Tke ha hae n lage cen accon defici on he back of pofolio inflo ma be

lneable o an eenal financing hock fom he EZ.

Figure 9: Real Polic Rate (%; August 2008, Septe mber 2011)

Soce: Naional aiic, Hae, Bloombeg, EMED, RGE


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Most countries have room to ease monetar polic, given that real interest rates are higher than their pre-

crisis levels.

Fige 10: Domeic Cedi (% of GDP; 2007, 2011 foeca)

Source: Moodys, RGE

Most EMs levered up after the financial crisis; none more so than China. This will limit the impact of looser

monetar conditions.

Fige 11: Reied Reee Raio (Ag 2008, cen)

Source: National statistics, Haver


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Several EMs have followed Chinas lead in using required reserve ratios to absorb capital inflows since the

crisis. This should provide a liquidity cushion for the domestic banking sector.

Fige 12: Fical Balance (% of GDP; 2007, 2011 foeca)

Soce: Naional aiic, Hae, Bloombeg, RGE

Every countrys fiscal position is weaker than it was in 2007, narrowing the room for counter cyclical

spending.

Fige 13: Goenmen Deb (% of GDP; 2007, 2011 foeca)

Soce: IMF, RGE


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However, most government balance sheets could withstand additional stimulus if need be.

Figure 14: FX Reserve s (% of GDP; June 2008, most rece nt available )

Soce: IMF, naional aiic, Hae, RGE

Asias FX reserves will prove useful in fending off financial contagion, while Latin America and Eastern

Europe are more exposed.

Figure 15: Real Effective Echange Rate (%, Septe mber 2011/five-ear ave rage to December

2010)

Soce: BIS, RGE

Most EM currencies have appreciated in real terms since the financial crisis.


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Figure 16: Nominal Effective Echange Rate (%, September 2011/five-ear average to December

2010)

S: BIS, RGE

Mo EM hae limied nominal FX appeciaion hogh cenal bank ineenion, geing highe domeic

inflaion inead.

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