With US economy almost on the verge of recession and very bearish outlook on the US economy growth rate it is very natural to ask if the slowdown in US economy will affect emerging and other developed overseas. Will it stall their growth or even make it negative?

There is no simple answer to it. US GDP contributes to more than 25% of the global GDP. This is a big factor in thinking that slowdown in US economy will make the entire global economy slow. But emerging market in Asia, Latin America and Middle east contribute to more than 22% of the global GDP now. Which is a great figure considering just a few years ago that number was in single digit.

Demand of basic materials for construction (iron, copper etc.) is very high in the growing Asian market. The Asian giants - India and China want to grow and their fire doesn't seem to be dying despite slowdown and sub-prime crises in US. Both India and China have to do a lot to make basic infrastructure conducive to existing and new businesses. And that means more construction, more job and growing economy. So demand will be there in the emerging economy despite slowdown in the US.

Middle eastern economy is just starting and there is lots of growth potential there. Russia, which was known mainly of oil and gas, is now a market of trendy restaurant chains, IT, telecom and other industries. European market is doing fairly well. So there is a lot of growth potential in the world even when US economy is not doing very well.

It's true that slowdown in US economy will have some effects on the global merket considering its share of global GDP but that would be offset by growth in emerging and other developed market like Europe and Australia. The effect of US slowdown on global economy would be minimal if not non-existent.