Fixated as we tend to be on our own economic woes, it’s all too easy to assume that it’s the same for everyone, to miss what is happening beyond the borders of Europe, and lose a bigger picture perspective on our relative standing. Yet, the truth is that, as a major new UN report points out, “the world is witnessing an epochal ‘global rebalancing’” that in recent decades has seen higher economic growth in at least 40 developing countries lift hundreds of millions of people from poverty, and pushed billions more into a new global middle class.
"The rise of the South is unprecedented in its speed and scale," the 2013 UN Development Programme's human development report, The Rise of the South: Human Progress in a Diverse World, says. "Never in history have the living conditions and prospects of so many people changed so dramatically and so fast."
“The South as a whole is driving global economic growth and societal change for the first time in centuries,” the report argues. Developing countries nearly doubled their share of world merchandise trade from 25 to 47 per cent between 1980 and 2010, driven by a dramatic rise in trade between them from less than 10 per cent to more than a quarter of all world trade.
Poverty is still with us, deep, brutal, oppressive poverty, and if anything increased inequality, but such gains have already helped the world achieve the main poverty eradication goal of the Millennium Development Goals, the reduction in half of the share of people living on less than $1.25 a day by 2015.
Crucially the global rebalancing has also transformed the internal economies and societies of the developing world, most notably in the extraordinary growth of a new middle class. Between 1990 and 2010, the South's share of the global middle class population expanded from 26 to 58 per cent. By 2030, more than 80 per cent of the world's middle class is projected to be residing in the South and to account for 70 per cent of total global consumption expenditure.
By 2025, annual consumption in emerging market economies will rise to $30 trillion, from $12 trillion in 2010, with the South home to three-fifths of the 1 billion households earning more than $20,000 a year. That soaring domestic demand is feeing urbanisation and an insatiable demand for education – the share of the world's people older than 15 who lack formal schooling is projected to shrink from 12 per cent in 2010 to 3 per cent in 2050, and the share with secondary or tertiary education will climb from 44 in to 64 per cent.