The 25 leading rapid-growth markets, of which South Africa is one, would remain the engines of global growth, with economic expansion of 4.9% forecast for this year, advisory firm Ernst & Young (E&Y) said in a report on Monday.

It described the sharp slowdown in leading rapid-growth markets since the beginning of 2012 as a “temporary blip” and stated that growth would start to accelerate in the second half of the year, picking up to 6% in 2013 and 6.5% in 2014.

“We will see a return to significant growth towards the end of the year. Soaring domestic demand in economies starved, for some time, of investment and consumption will offer business exciting new markets for goods and services in the years ahead,” said E&Y emerging markets center coleader Alexis Karklins-Marchay.

According to the E&Y quarterly ‘Rapid-Growth Markets Forecast’, growth is expected to hold up best in Asia, but it is Ghana that would take the crown as the fastest-growing country among the 25 nations. China is seen as the second-fastest growing country, followed by Nigeria in the number-three position.

Asian rapid-growth markets would slow to 6.2% this year, from 7.4% in 2011, before accelerating to 7.3% in 2013.

Central and Eastern Europe and Latin American countries were hindered by the slow growth in their key export markets of the eurozone and US respectively.

“If the eurozone were to fall further into recession, Czech Republic and Poland would be pushed into recession, with Hong Kong and Malaysia also hit hard owing to their dependence on global trade,” the report stated.

E&Y senior economic adviser to the Rapid-Growth Market Forecast, Carl Astorri, said the rapid-growth markets were well placed to weather the major risks facing the global economy, given that they had the space to relax fiscal and monetary policy.

“This has already happened in some rapid-growth markets. It is likely that there will be further easing of monetary policy in the months ahead, particularly if the global economy deteriorates further.”

These fast-growing countries also had an expanding middle class with increasingly higher incomes and an appetite to spend. According to the E&Y report, the number of households receiving an income of over $30 000 would more than double, reaching 149-million by 2020, overtaking the US and the eurozone.

In 2011, two-thirds of consumer spending across the world came from the advanced economies, with the remaining third coming from the emerging markets. However, in 25 years time emerging Asia alone would have overtaken the advanced economies as the key source of consumer spending, responsible for almost 40%.

“Consumer demand from rapid-growth markets will eventually replace the advanced economies as the key driver of global growth. The shift in import demand should also assist in rebalancing the economy,” said Karklins-Marchay.

Besides the ability to relax policy to boost growth and a growing middle class to aid consumer spending, rapid-growth markets would also see a strong rise in foreign direct investment (FDI) in the long term.

E&Y warned that the eurozone crisis would have a negative impact on FDI into rapid-growth markets during 2012, with a possible drop of 10% forecast. However, longer-term FDI would continue to grow as companies were drawn to the high growth rates of these countries, while growth remained stagnant elsewhere in the world.

In the short term, E&Y said the weakness would be particularly apparent in the European economies with Central and Eastern Europe being hit hardest. FDI into Russia and India could also lose momentum.

E&Y Africa business center director Michael Lalor commented that foreign investors were beginning to spread their investments across the globe. This was seen as a positive trend for Africa, where FDI projects grew by 27% between 2010 and 2011. Countries such as South Africa, Nigeria and Ghana were experiencing increases in excess of 50%, Lalor said.