In the past decade, emerging economies caught up to the developed world in consumption, and will soon overtake them. Needless to say, this is good for the global economy. That’s not to discount the real suffering entailed by folks in the U.S. and other developed countries as opportunities (for manufacturing toaster ovens, analyzing radiograms, and so on) shift from one region to another. But in the long run this rising tide lifts all boats, as demand grows for goods and services. We can see how this works by looking at imports into emerging markets, which in the past decade grew twice as fast as imports by developed countries. We’ve reached a point where cross-border demand from emerging markets is now surpassing that of developed markets as a share of total imports.
While we wait for the statisticians to calculate the 2011 numbers, final economic output numbers for 2010 shed light on long term trends important to the language services industry. In 2010, world output and per capita income began to recover from the 2008-09 recession. While recessions are common occurrences in regional markets, this last downturn was the first global recession since 1946. So, the recovery is taking longer than usual. Gross World Product (GWP) grew 4.9% in 2010, largely on the strength of rebounding exports, which rose about 20% from the level of 2009. That’s a staggering figure, and in combination with the shift to emerging market demand, could indicate a step change in the shift toward global economic integration.
The 2010 growth figures were not evenly distributed across countries. According to The World Factbook, lower income countries - those with per capita incomes below $30,000 per year - averaged 6.6% growth, while higher income countries - with per capita incomes above $30,000 - averaged just 2.9% growth. As we’ve pointed out, South-to-South trade is one part of this equation, with trade growing between Brazil, India, and South Africa, for instance.
This data is no surprise for companies that work in the translation business. The language services industry, with worldwide revenue over US$30 billion in 2010, has seen 15% +/- annual growth for as long as Common Sense Advisory has measured it (since 2006). Last year, even when the global recession finally affected all sectors, growth in the translation, localization, and interpreting space continued at a rate of 7.14 percent. On average in the past decade, the language services industry has grown faster than the Chinese economy – a pace frequently pronounced as “torrid.” In recent years, we’ve pointed to the growth in the number of languages requested in translation projects and visible on corporate websites. This trend is likely to continue as the old stalwart economies of Japan, the U.S., and Western Europe look like mountains in a cluster of hills, rather than mountains on a plain.