Emerging Markets Outlook 2026 (Triodos Bank)

Summary

• Emerging market economies are projected to grow by 4% year-on-year in both 2025 and 2026.p.2
• India's services exports account for nearly 5% of the world's total, up from 3% a decade ago.p.4
• China's services sector grew from less than 30% of GDP in 1985 to 57% in 2024, accounting for half of all domestic employment.p.4
• Inflation in emerging markets is expected to gradually recede to around 4.7% in 2026 from slightly above 5% in 2025.p.5
• In 2024, funding for infrastructure projects under China's Belt & Road Initiative increased by 32% year-on-year.p.6
• Triodos Investment Management reported assets under management of EUR 5.8 billion as of 31 December 2024.p.8

Key insights

1. US effective tariff rates fell from their April 2025 peak, providing emerging market businesses with renewed confidence despite remaining higher than 2024 levels.p.3
2. China is driving clean energy expansions in emerging Asian nations, including solar growth in Pakistan and wind turbine installations in Uzbekistan.p.3
3. Elevated youth unemployment in countries such as Indonesia, Bangladesh, and Kenya highlights how growth lacking social inclusion leads to social instability.p.4
4. India's service sector has expanded at nearly double the global rate and employs 3 million people in multinational technology and research hubs.p.4
5. While inflation is dropping in Asia, emerging Europe and Sub-Saharan Africa continue to experience high inflationary pressure.p.5
6. The US International Development Finance Corporation has approved funding packages for mining projects in countries like Brazil and Gabon to secure vital resources.p.6
7. Europe is adapting its Global Gateway program into a project investment tool to secure natural resources while aiming to retain local value addition.p.6