We discuss our outlook on emerging markets and why we believe these economies are entering a new era of self-sustaining growth.
Key takeaways:
- A shifting centre of gravity: the world is under transformation, driven by a confluence of factors including geopolitics, expanding domestic demand, demographics, growing inter-EM trade, financialisation, and technological innovation.
- Greater economic influence: more than 80% of the global population resides in the developing world, and this demographic weight is steadily translating into economic influence. Emerging market (EM) economies expected to generate roughly 65% of global economic growth by 2035.
- An under-owned opportunity: despite a compelling outlook and their significance in the global economy, EMs remain underrepresented and undervalued. EM countries still represent only 10-12% in global equity benchmarks, while EM equities continue to trade at a historically wide discount to DM.
