Great Recession: GDP growth for the E7 emerging economies 2007-2011

The Global Financial Crisis (2007-2008), which began due to the collapse of the U.S. housing market, had a negative effect in many regions across the globe. The global recession which followed the crisis in 2008 and 2009 showed how interdependent and synchronized many of the world's economies had become, with the largest advanced economies showing very similar patterns of negative GDP growth during the crisis. Among the largest emerging economies (commonly referred to as the 'E7'), however, a different pattern emerged, with some countries avoiding a recession altogether. Some commentators have particularly pointed to 2008-2009 as the moment in which China emerged on the world stage as an economic superpower and a key driver of global economic growth.

The Great Recession in the developing world

While some countries, such as Russia, Mexico, and Turkey, experienced severe recessions due to their connections to the United States and Europe, others such as China, India, and Indonesia managed to record significant economic growth during the period. This can be partly explained by the decoupling from western financial systems which these countries undertook following the Asian financial crises of 1997, making many Asian nations more wary of opening their countries to 'hot money' from other countries. Other likely explanations of this trend are that these countries have large domestic economies which are not entirely reliant on the advanced economies, that their export sectors produce goods which are inelastic (meaning they are still bought during recessions), and that the Chinese economic stimulus worth almost 600 billion U.S. dollars in 2008/2009 increased growth in the region.