HSBC's composite emerging markets index of manufacturing and services purchasing managers' surveys slipped to 50.3 from 51.1 in February, teetering on the 50 threshold that marks the difference between expansion and contraction.
The index is under the 2013 average of 51.7 and the long-run level of 54.0, as output contracted in three of the four biggest emerging economies, China, India and Russia.
Based on data from purchasing managers at about 8,000 firms in 17 countries, the survey showed China posting a decline for the second month in a row, India slipping back into contraction and Russian output slumping at the sharpest rate since May 2009.
As a result, emerging markets output fell for the first time in eight months in March while service sector activity rose at the slowest pace since July.
"Emerging markets are going through a rough patch. Lacklustre demand in advanced markets has so far restrained exports. Political uncertainty locally may also be to blame," said Frederic Neumann, co-head of Asian economic research at HSBC.
Elections are due this month in countries including India, Hungary and Indonesia, while Turkey held closely watched municipal elections last weekend. Geo-political tensions around Russia and Ukraine have also cast a shadow over eastern Europe.
But Neumann said the slowdown was down to deeper, structural issues, such as reforms in China that were restraining growth and credit access in the short term.
"Slowing mainland growth is spilling over to other emerging markets as well, primarily to those reliant on commodity exports," he added.
The exception among the big economies was Brazil where manufacturing accelerated to the fastest level in three months.
But all four BRICs, Brazil, Russia, India and China, registered the lowest business expectations in manufacturing last month, with Russia showing the weakest overall outlook. The Czech Republic, Poland and Vietnam exhibited the strongest sentiment.
HSBC's future output index, which tracks firms' expectations for activity in 12 months' time, eased from February's 11-month high as manufacturing expectations weakened.
The HSBC index is calculated using data produced by Markit.