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Washington. From Asia to Latin America, emerging economies are preparing for for a global slowdown, indicating deep concern about the developed world as well as new--found room for maneuver at home.

Those who can, do.

While central banks in the United States, Europe and Japan are forced to look for ever more arcane ways to prop up their ailing economies, emerging markets are doing it the old--fashioned way.

On Tuesday Indonesia's central bank became the latest country to unexpectedly cut interest rates in order to stimulate growth, following a similar move by Brazil.

Mexico is expected to follow with a similar rate cut -- an option not open to many developed economies which already have interest rates near zero.

"Whether we like it or not, the global economic slowdown is affecting developing countries," Bank Indonesia Governor Darmin Nasution said announcing the move.

Behind his comment, and others like it, is a candid acknowledgement of the enduring role US, European and Japanese demand plays in Asia and Latin America, and a new--found freedom from fears of inflation.

Three years ago when panic swept across the United States and Europe, many emerging markets appeared cautious but confident that decades of crises--by--osmosis would not be repeated.

Many emerging economies, the argument went, were now healthy enough to avoid catching a cold when the United State or Europe sneezed.

But last month the International Monetary Fund sought to scotch this view as irrational exuberance.

The Washington--based lender warned that emerging economies needed to steel themselves from the risks of economic failure in advanced countries.

"Many emerging economies need to make faster progress in strengthening fiscal fundamentals before cyclical factors or spillovers from advanced economies... turn against them," the IMF said in a regular report.

"Should downside risks materialize, those emerging economies with low debt and deficits could slow the pace of consolidation to support domestic consumption."

That message has been taken onboard according to experts despite any previous hubris.

"It is clear that there is concern about the impact of events in the global business cycle," said John Williamson, a former World Bank, IMF and British Treasury economist now with the Peterson Institute for International Economics.

According to Williamson "the decoupling is dead crowd" never had much of a case and measured moves to cut interest rates are modest so long as inflation is kept in check.

Yet risking even modest rises in inflation is something that many emerging nations would have been reluctant to do just a few years ago.

"They have a greater degree of freedom than they did in those days. I don't think they had the freedom to do it then," said Williamson.

For Mark Weisbrot of the Center for Economic and Policy Research, there has also been a shift in policy orthodoxy, particularly in Brazil.

"There has been a gradual change in macroeconomic policy in Brazil since 2004--2005, when they have moved to loosen both fiscal and monetary policy."

"You are seeming a change in attitude, more pro--growth than financially focused."

"It is more than justified, they are capable of much higher growth."

AFP