Perspectives | Cordiant - perspectives fr

By: Cordiant  09-12-2011
Keywords: Frontier Markets

Most of us realize that over the last decade the roles of advanced economies (AEs) and emerging markets (EMs) have been reversed, but few of us have changed the structure of our portfolios to reflect this reversal. In the past, foreign-currency debt constituted a large part of the external liabilities of EMs. Today, however, foreign [..]

In the June update of its Economic Outlook, the IMF confirms the slowdown in the world’s economies, from 5.1% growth in 2010 to 4.3% in 2011.  Developing Countries, with 6.6% growth, continued to outpace the 2.2% growth of Advanced Economies. This slowdown is occurring in all regions except Sub-Sahara Africa where growth is expected to [..]

Not only has the corporate landscape undergone a notable and dramatic improvement since the bottom of the financial crisis, but the high expectation of corporate default that accompanied the crisis proved to be wildly overestimated. Instead of the anticipated rate of 25%, actual default rates were closer, in fact, to 11%, and today they stand [..]

“Frontier Markets” is an economic term coined by IFC’s Farida Khambata in 1992.  It is used to describe a subset of very small emerging markets.  They have lower market capitalization and less liquidity than more developed emerging markets. The IFC’s definition of frontier markets is wider than that of the index providers.  IFC’s strategic priorities [..]

The following summarizes the IMF’s view on capital flows into developing countries.[1] Developed country sovereigns have experienced 25 downgrades since early 2008, while emerging market sovereigns have seen 21 upgrades during 2010.  The following chart[2] illustrates the diverging trends between developed and developing markets. As a result, we have seen strong capital inflows to emerging [..]

Keywords: Frontier Markets

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09-12-2011

Perspectives | Cordiant | Page 3

No prudent and forward looking asset allocation program can be designed without understanding the massive demographic changes that will reshape our world over the coming decades. As Reinhart and Rogoffdemonstrate in their January 2010 paper, there is a strong relationship between the level of government debt and real GDP growth.


09-12-2011

Perspectives | Cordiant | Page 2

The following summarizes the IMF’s view on capital flows into developing countries.Developed country sovereigns have experienced 25 downgrades since early 2008, while emerging market sovereigns have seen 21 upgrades during 2010. Economic activity requires an encouraging regulatory environment and effective rules that are transparent and accessible to all.


09-12-2011

Perspectives | Cordiant - perspectives

Not only has the corporate landscape undergone a notable and dramatic improvement since the bottom of the financial crisis, but the high expectation of corporate default that accompanied the crisis proved to be wildly overestimated.