The China-U.S. trade frictions and rising protectionism have not only hurt the global economy but have also adversely impacted emerging markets. But why would a trade agreement between China and the U.S. be good news for the entire world? 

On Tuesday, the World Bank in its latest report cut its global growth forecast for 2019 by 0.1 percentage point to just below 3 percent. In October, the IMF also cut its world economic growth outlook by 0.2 percentage point. Both financial institutions have cited the trade war as one of the biggest reasons. The World Bank and IMF reports say the trade war is hurting global economic growth, particularly in emerging markets.

According to the estimates, the downward trend would marginally affect China's growth. For 2019, the World Bank has reduced its China GDP projection by 0.1 percentage point, while the IMF has cut it by around 0.2.

But neighboring India has been severely hit by protectionist policies – its rupee was one of Asia's worst performing currencies in 2018. Experts cite the strengthening of the U.S. dollar as one of the main reasons, along with fluctuations in global crude oil prices due to tensions between Iran and the U.S. And U.S. tariffs on Indian steel and aluminum imports aren't helping matters. 

Turkey was the flag bearer of emerging economies until early last year. But it witnessed a sudden flight of foreign capital, due to rising interest rates in the U.S. Its currency, the lira, lost around 28 percent of its value against the U.S. dollar in 2018. The IMF, in its October report, cut the country's 2019 growth forecast from 4 percent to less than 0.5 percent.

South Korea, Asia's fourth-biggest economy is feeling the pinch as well. The country posted its biggest fall in exports in more than two years due to trade tensions between South Korea's two biggest business partners – China and the U.S. According to 2017 figures, exports account for over 40 percent of the country's total GDP. Growth was at 2 percent in the third quarter, down from 2.8 percent in the second quarter. 

The health of emerging markets is critical to the world economy. Emerging markets have steered global economic growth for two decades now, contributing over 75 percent of the growth in output and consumption. From 2010 to 2016, seven major emerging markets accounted for almost a quarter of output. In 2016 alone, these emerging markets contributed one percentage point to the global growth rate of 2.4 percent.