The inevitably highly cyclical nature of emerging economies with low savings rates

We look at the examples of large emerging countries that suffer from low savings rates (Brazil, Turkey, South Africa, India). We want to show that these countries inevitably experience large cyclical fluctuations in their economies, i.e. periods of growth followed by periods of crisis, with the following mechanisms: When growth is strong, the investment rate inevitably exceeds the savings rate, which is low . A significant external deficit appears, leading to financing difficulties, which leads to exchange rate depreciation and imported inflation; The rise in inflation reduces real household and corporate income, leading to lower domestic demand and growth. This results in a fall in the investment rate, the elimination of the external deficit and an appreciation of the exchange rate; The appreciation of the exchange rate reduces inflation, improves the terms of trade and brings back growth: the economy thus return s to the starting point of the cycle.