The Economist- Developing countries have come out of the recession stronger than anyone had expected. This will have profound consequences for the rest of the world

THE political and social consequences of the worst economic crisis since the Great Depression have been milder than predicted. In developing countries, at least, governments have not fallen in a heap, as they did after the Asian crisis of 1997-98. They have not battled their own people on the streets, as happened in Europe during the 1930s. Social-protection programmes have survived relatively unscathed. There have been economic-policy shifts, naturally, but no panicky retreat into isolation, populism or foreign adventures. The good news has not been spread evenly, of course: some countries have ridden the storm more successfully than others. And these are only first-round effects: things could still get worse. So far, though, resilience has been the order of the day.

This was not expected a year ago. Then, it seemed likely that normal rules would apply—that when the rich world sneezes, developing countries get swine flu. In the fourth quarter of 2008, when rich economies were contracting by 5% to 10% a year, real gdp fell at an average annualised rate of around 15% in some of the world's most dynamic economies, including Singapore, South Korea and Brazil. The fall in Taiwan's industrial output—down by a third during 2008—was worse than America's worst annual fall during the Depression.

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