Emerging economies will lead growth in 2013 as the global economic outlook remains challenged by the eurozone's debt crisis and high unemployment in the United States, according to a report released on Wednesday.
Growth rates in and around Europe look weak over the next 12 months with an expected expansion of 0.2% in the eurozone and 1.1% in the United Kingdom, according to Grant Thornton's quarterly International Business Report.
Economic growth in the United States remains weak and unemployment high, while growth rates in China are expected to pick up to 8.2% in 2013 from 7.8%, while India is expected to quicken to 6.0% and Brazil to grow 4.0%.
Business optimism in Brazil, Russia, India and China, also known as BRIC countries, increased in the fourth quarter of last year.
The survey of 3,200 business leaders in 44 countries found that optimism in the BRIC economies, all deemed to be at a similar stage of newly advanced economic development, has increased to 39% in the last quarter of 2012 compared with 34% one year earlier.
Emerging markets in Asia Pacific (excluding Japan) also saw an uptick in business optimism, while optimism in North America decreased during the same period. It swung from 6% in the fourth quarter of 2011 to 52% in the second quarter of last year, before falling back to just 1% by year-end.
What is holding these countries back is the cost of borrowing. More than a third (34%) of businesses in the BRIC economies cite the cost of finance as constraints on their growth prospects, compared with 17% in Group of 7 countries.
More than a fifth of BRIC businesses cite the poor quality of local transport, information and communications technology and infrastructure as likely growth constraints in 2013.