Asset Allocators' Soapbox: Is an emerging markets crisis on the cards?

The first decade of the 21st century was particularly kind to emerging markets. Economic growth was exceptionally strong and institutional frameworks improved. This benign backdrop helped draw in capital and delivered excess returns across most asset classes. More recently, however, some of this gloss has worn off. The external environment has become less favourable, with global trade growth much weaker than before the financial crisis. The Chinese economy, such an important driver of emerging market growth, is expanding at a slower pace, putting downward pressure on the prices of com...