Emerging and growth-leading economies
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Emerging and growth-leading economies (EAGLEs) are a grouping of key
emerging markets An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
developed by
BBVA Banco Bilbao Vizcaya Argentaria, S.A. (), better known by its initialism BBVA, is a Spanish multinational financial services company based in Madrid and Bilbao, Spain. It is one of the largest financial institutions in the world, and is present ...
Research. The EAGLE economies are expected to lead global growth in the next 10 years, and to provide important opportunities for investors.


EAGLEs

EAGLEs is a grouping acronym created in 2010 by BBVA Research to identify all
emerging economies An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
whose contribution to world economic growth in the next ten years is expected to be larger than the average of the G6 economies ( G7 excluding the
U.S. The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
). This is a dynamic concept where country members can change over time according to their forecasted performance relative to developed economies. The membership of the EAGLEs is subjected to a yearly revision and can change according to their forecasted economic performances relative to developed economies.


Other economic concepts

As world economic growth rotates from developed to developing countries, there has been increasing interest in identifying
emerging markets An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
that will become global leaders, as well as increasing the lobbying of some countries to be included in the BRIC definition. However, many economists have argued that the
BRIC BRIC is a grouping acronym referring to the developing countries of Brazil, Russia, India, and China, which are identified as rising economic powers. It is typically rendered as "the BRIC," "the BRIC countries," "the BRIC economies," or alte ...
concept (Brazil, Russia, India and China) is outdated and have proposed alternative definitions. The EAGLEs concept is similar to other proposals in going beyond BRICs (such as the
CIVETS A civet () is a small, lean, mostly nocturnal mammal native to tropical Asia and Africa, especially the tropical forests. The term civet applies to over a dozen different species, mostly from the family Viverridae. Most of the species diversity ...
,
Next Eleven Terence James O'Neill, Baron O'Neill of Gatley (born 17 March 1957) is a British economist best known for coining BRICs, the acronym that stands for Brazil, Russia, India, and China—the four once rapidly developing countries that were though ...
or 7 percent club) but its methodology differs from others' in several ways: * It gives less relevance to economic size and population, which may be misleading. * It focuses on the Incremental GDP (IGDP) economies will generate, instead of paying attention to the current or expected size of their GDP. This creates a situation in which having high GDP or a high growth rate is not enough on its own to make the country a key global player. It is a combination of both that really matters. * The cut-off is explicit. In order to become an EAGLE member, each country's expected Incremental GDP in the next 10 years needs to be greater than the one anticipated for the average of the G6 economies, G7 excluding the U.S. * It is not a closed group and the concept is not linked to an acronym formed by a given set of countries. * The results are based on a shorter horizon – 10 years – than the ones considered in other cases, ranging from 20 to 50 years. Over the years there have been several attempts to try to implement the economic concept that will best reflect the potential of
emerging markets An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
in the coming years. After BRIC concept was coined by
Goldman Sachs Goldman Sachs () is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered at 200 West Street in Lower Manhattan, with regional headquarters in London, Warsaw, Bangalore, H ...
in 2001, there were other endeavors to find the best grouping acronym such as: CIVETS,
Next Eleven Terence James O'Neill, Baron O'Neill of Gatley (born 17 March 1957) is a British economist best known for coining BRICs, the acronym that stands for Brazil, Russia, India, and China—the four once rapidly developing countries that were though ...
, 7 per cent club and the EAGLEs. In January 2011, Goldman Sachs decided to re-define its current definition of
emerging markets An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
and proposed a new term "Growth Markets". The separation of Growth Markets from Emerging Markets is aimed to show the world's most dynamic economies – those that are at least contributing 1 per cent to global growth (outside of the Developed World). In the first approach, eight economies have been identified and they were: BRIC economies plus
Mexico Mexico (Spanish: México), officially the United Mexican States, is a country in the southern portion of North America. It is bordered to the north by the United States; to the south and west by the Pacific Ocean; to the southeast by Guatema ...
,
South Korea South Korea, officially the Republic of Korea (ROK), is a country in East Asia, constituting the southern part of the Korea, Korean Peninsula and sharing a Korean Demilitarized Zone, land border with North Korea. Its western border is formed ...
,
Turkey Turkey ( tr, Türkiye ), officially the Republic of Türkiye ( tr, Türkiye Cumhuriyeti, links=no ), is a list of transcontinental countries, transcontinental country located mainly on the Anatolia, Anatolian Peninsula in Western Asia, with ...
and
Indonesia Indonesia, officially the Republic of Indonesia, is a country in Southeast Asia and Oceania between the Indian and Pacific oceans. It consists of over 17,000 islands, including Sumatra, Java, Sulawesi, and parts of Borneo and New Guine ...
. This particular shift in terminology was initially proposed by BBVA Research (later followed by Goldman Sachs) with the aim of switching from the existing static concept to something more dynamic, that could better indicate market potential.


Nest

As part of the EAGLEs proposal, the EAGLEs' Nest is a second set of countries with expected Incremental
GDP Gross domestic product (GDP) is a monetary measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjective nature this measure is ofte ...
in the next decade to be lower than the average of the G6 economies ( G7 excluding the
U.S. The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
) but higher than
Italy Italy ( it, Italia ), officially the Italian Republic, ) or the Republic of Italy, is a country in Southern Europe. It is located in the middle of the Mediterranean Sea, and its territory largely coincides with the homonymous geographical re ...
's (G6 Minimum), the country which is anticipated to contribute least to global growth within the G7. The membership of the EAGLEs' Nest is subject to a yearly revision and can change according to forecasted economic performances. Three countries which would otherwise have met the criterion for the Nest were excluded:
Iraq Iraq,; ku, عێراق, translit=Êraq officially the Republic of Iraq, '; ku, کۆماری عێراق, translit=Komarî Êraq is a country in Western Asia. It is bordered by Turkey to Iraq–Turkey border, the north, Iran to Iran–Iraq ...
and
Saudi Arabia Saudi Arabia, officially the Kingdom of Saudi Arabia (KSA), is a country in Western Asia. It covers the bulk of the Arabian Peninsula, and has a land area of about , making it the fifth-largest country in Asia, the second-largest in the A ...
because BBVA classifies them as
frontier A frontier is the political and geographical area near or beyond a boundary. A frontier can also be referred to as a "front". The term came from French in the 15th century, with the meaning "borderland"—the region of a country that fronts o ...
, not emerging markets; Iran was excluded due to sanctions and thus not a suitable target for investors. Iran would have been an EAGLE in 2012 and a nest in 2011 and 2013, Iraq and Saudi Arabia only qualified for the Nest.


Indexes

On September 9, 2011,
Dow Jones Dow Jones is a combination of the names of business partners Charles Dow and Edward Jones. Dow Jones & Company Dow, Jones and Charles Bergstresser founded Dow Jones & Company in 1882. That company eventually became a subsidiary of News Corp, and ...
and
BBVA Banco Bilbao Vizcaya Argentaria, S.A. (), better known by its initialism BBVA, is a Spanish multinational financial services company based in Madrid and Bilbao, Spain. It is one of the largest financial institutions in the world, and is present ...
launched two
equity Equity may refer to: Finance, accounting and ownership * Equity (finance), ownership of assets that have liabilities attached to them ** Stock, equity based on original contributions of cash or other value to a business ** Home equity, the dif ...
indexes that allow investing in leading companies traded in Emerging and Growth-Leading Economies (EAGLEs). There are two indexes, "Dow Jones BBVA EAGLEs" and "Dow Jones BBVA EAGLEs Optimized",
Dow Jones BBVA EAGLEs Optimized Index
both composed of a set of 50 companies. The allocation by country is macro driven according to the contribution each EAGLE is going to make to incremental
GDP Gross domestic product (GDP) is a monetary measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjective nature this measure is ofte ...
within the group, in the next ten years. It is a dynamic index which changes its composition along with macro forecasts; hence it is an adaptive index when compared with other static peers. Revisions are made annually in March to update the indices compositions according to the latest macroeconomic forecasts. It is also a liquid index which provides a diversified exposure to
Emerging Markets An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
. In order to facilitate index replication by foreign investment firms, the sample of 50 companies is chosen from the
Dow Jones Dow Jones is a combination of the names of business partners Charles Dow and Edward Jones. Dow Jones & Company Dow, Jones and Charles Bergstresser founded Dow Jones & Company in 1882. That company eventually became a subsidiary of News Corp, and ...
Global Total Stock Market Index, plus HK and US listed Chinese companies.


See also

*
Emerging market An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
*
Developed market In investing, a developed market is a country that is most developed in terms of its economy and capital markets. The country must be high income, but this also includes openness to foreign ownership, ease of capital movement, and efficiency of ma ...
*
World economy The world economy or global economy is the economy of all humans of the world, referring to the global economic system, which includes all economic activities which are conducted both within and between nations, including production, consumption, ...


References


External links

* Bettina Wassener. The New York Times. 15/11/201
New Term for Emerging Economies Is Suggested
* Jon Herskovitz. Reuters. 29/12/201
Analysis: S.Africa, not just another BRIC in the wall
* James Newman. Business News Americas. 12/11/201
BBVA adds its EAGLES to the BRIC, CIVETS debate – Regional
* Alicia García-Herrero, Daniel Navia, Mario Nigrinis. BBVA Research 15/12/201
Why investors should focus on BBVA EAGLEs
{{DEFAULTSORT:Emerging And Growth-Leading Economies Economic growth Economic country classifications