The amount of private capital flowing to emerging markets hit a record $647 billion in 2006. GDP also increased by 7.3 percent in developing countries compared with 4 percent worldwide, according to World Bank’s Global Development Finance 2007 report, released May 29.

Companies in emerging markets are raising large sums of capital and their participation in global finance is key to the growth of the developing countries, the report stated. It added that access to global capital markets allows the companies to diversify their sources of funds, improve risk management, borrow at longer maturities and reduce their cost of capital.

However, the report cautioned that growth rates could slow through 2009 as cyclical factors might cause higher borrowing spreads and risks. Uncertainty over G8 commitments to the poorest countries also could affect emerging market economies, the report stated, noting that official development assistance has stalled.