Long-term winners share these traits

Article Excerpt

In a comprehensive 2018 study of the best-performing emerging economies, the McKinsey Global Institute identified 18 nations that have achieved at least 3.5% GDP growth over the past 50 years, or 5% over the past 20 years. These top-performing economies share two common characteristics: A pro-growth agenda, adopted across the public and private sectors and aimed at boosting productivity, investment, income, and demand; and the presence of large, competitive local firms that propel the domestic economies and, in many cases, become globally competitive. On average, these economies have twice as many companies with revenue over $500 million as other emerging economies. These firms bring productivity benefits by investing in assets, research and development and job training, which create spillover effects for smaller firms. Asia is disproportionately represented in the McKinsey Global Institute’s group of outperforming countries. Its long-term high performers include China, Indonesia, Malaysia, South Korea, and Thailand. Its more-recent outperformers include Cambodia, India, Laos, Myanmar, and Vietnam. …