The strength of emerging countries rebalances world growth. The
decoupling of emerging countries and
developed countries has finally occurred, but in a specific and new way.
As stakeholders in the world economy,
emerging countries could not escape
being affected -- where companies
were too heavily indebted, the growth
contraction brought on credit crises
(i.e.: significant increases in payment defaults). But, in most cases, the emerging
countries managed this crisis independently. They demonstrated their ability
to learn from previous crises and to rely
on solid fundamentals, which allowed
them to implement recovery policies.
If the end of the credit crisis is confirmed, the 2010 recovery in industrialized countries is of high risk because of
;The;bubble;in;public;debt;is;espe-cially;dangerous. It is not so much
the risk of sovereign defaults that is
feared, but rather the need to quickly
implement budget restriction policies
that are detrimental to growth and
therefore to companies.
to;be;monitored. After strong
credit growth that supported Chinese
companies, the authorities have
decided to restrict the credit supply
in overcapacity sectors. This “
go-and-stop” policy, typical of China, could
destabilize fragile companies.
Sharp stock market volatility can be
expected in industrialized countries
due to optimism in the financial markets that is out of sync with the real
The bursting of these bubbles is likely
to generate new negative shocks for
companies (“W” recovery scenario). A
relapse would affect companies, many
of which are now quite weakened after
two years of low activity. However,
United Arab Emirates
Coface country ratings indicate the average level of risk presented by a country’s companies on their
commercial transactions. The ratings do not assess sovereign debt.