Page 38 - Insurance Times April 2022

economy is likely to have
some characteristics that will
fit with one or more of the
above three criteria, but not
all. For now let's consider
emerging economies as
those countries which have
started to grow but have yet
to reach a mature stage of
development or where there
is significant potential for
economic or political
instability.

Figure 1. -The Process of Risk Management Maturity
Maturity is used to describe one of the stages in a
Background continuum or life cycle of development. The stages are birth,

"Emerging economies are a dominant strategic growth, maturity and decline which follow a pattern such
business risk for most sectors of the global as that depicted in Figure 2. This pattern is seen in many
situations including the launching of new products, the
economy."
growth and decline of industries, the rise and fall of sports
teams and so on.
The term emerging economies can be described as the
economies of all those countries that are not considered To measure the stage of development of a country the value
developed. Here developed countries include the major generally used is GDP as income and development is closely
European countries and the US, Canada, Japan, Australia, linked together.
and New Zealand. Another perspective to look at the
meaning behind emerging economies is to consider some
of their key attributes. The major ones would be:
Y Level of Income
Y Growth rate
Y Stage of Development
Y Stability

Each country that is generally considered an emerging

Figure 2. -Life Cycle

In terms of Figure 2 emerging economies can be placed at
growth phase but they could be little past the birth stage
or almost reaching maturity (depends). Most developed
countries would be at the top of growth stage or in
maturity. Few could be considered in decline. As with all
classifications there are always some anomalies. Singapore,
Hong Kong and Taiwan, for instance, which have GDP per

38 The Insurance Times, April 2022