Argentina, Brazil, Indonesia, South Africa, Turkey To Be Affected by China

China’s reduced thirst for commodities would depress commodity exporters, especially the poorly managed emerging economies of Argentina, Brazil, Indonesia, South Africa and Turkey.

All five depend on continuing foreign-investment inflows and lack the cushioning effect of current-account surpluses to accommodate hot-money outflows, as happened earlier this year. Consequently, they were forced to raise already-climbing interest rates to attract new money and protect their weak currencies. Their falling stock markets over the last decade also reflect economic and financial weaknesses.

Gary Shilling