When it comes to investing in the emerging markets, look to the consumer rather than the exports.
That’s the view of Didier Saint-Georges, a member of the investment committee at Carmignac Gestion. He believes that emerging market consumers are a rapidly growing source of demand; as their incomes grow, so their consumption patterns change with more emphasis on discretionary and luxury goods, telecoms and financial services.
Saint-Georges also believes other factors are favourable for investors looking at the emerging markets.
The US economy recovery is stimulating exports from these economies while inflation is not a great threat. In China, the biggest emerging market of all, growth is solid (even if a bit slower than it was) while the new political elite is making good progress to create a more stable financial system
Finally, while many investors believe emerging market debt is overpriced, Saint-Georges sees selective opportunities in countries such as Poland, Mexico and Turkey where prices may benefit from falling interest rates.