Emerging markets are markets in countries that are restructuring their economies to become market-oriented and thus offer opportunities in trade, technology transfers, and foreign direct investment. They are in transition from developing to being fully developed. According to the World Bank, the five biggest emerging markets are China, India, Indonesia, Brazil and Russia. Mexico, Argentina, South Africa, Poland, Turkey, and South Korea are considered emerging markets as well.
The term was coined by Antoine van Agtmael in 1981 when he was working for the International Finance Corporation (IFC), a division of the World Bank. He hoped to attract needed investment to a set of once-obscure, now promising stock markets.
Emerging markets are characterized by strong economic growth and rising disposable incomes. However, many of their citizens are still relatively poor. They are regional economic powerhouses with large populations, resource bases, and markets.
They are societies that are undertaking domestic economic and political reforms, moving away from state interventionist policies that failed to produce economic growth and toward open door policies. They are the world's fastest growing economies and are expected to become more significant buyers of goods and services than industrialized countries. They are also critical participants in the world's political, economic, and social affairs. They are seeking a larger voice in international politics and a bigger slice of the global economic pie.