ING Investment Management says that reforms improving the prospects for growth is the most attractive strategy theme for emerging market investing at present. ING IM senior emerging markets strategist, Maarten-Jan Bakkum, commented: “In what is the weakest growth environment for EMs since the 1990s, investors should select countries in which reforms will improve the prospects for growth.” He picked six countries where reform is a relevant theme: Mexico, India, Thailand, Egypt, Indonesia and Brazil.
In Mexico, a series of reforms are being implemented, including energy reforms opening up this sector to foreign investors. India, Thailand and Egypt have all changed governments, and Bakkum said that the new governments should improve macro imbalances and investments in infrastructure. On Brazil, Bakkum said that meaningful supply-side reforms could be implemented depending on election results, leading to improved investment prospects.