Does economic growth really drive EM equity returns?

EMs

Archie Hart, manager of Investec's 4Factor Emerging Markets Equity fund, warns the relationship between GDP growth and equity returns might not be as strong as commonly supposed.

A typical presentation on emerging markets often begins by saying economic growth in the developing world is higher than in developed markets, and ends implying that emerging market equities will outperform developed market equities in the medium to long-term. For convenience, let us call those who hold this theory ‘growthers’. We have recently looked into this theory and concluded the relationship might not be as strong as commonly supposed. Accurately forecasting GDP growth is very difficult and there are other drivers of stock market returns to consider, not least entry valuation. ...