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The BRICS or the acronym given to the grouping of Brazil, Russia, India, China, and South Africa in so far as promising economic growth is concerned, has now reached a stage where global investors are on the lookout for the next emerging economic hotspots.
Indeed, for much of the last decade, the BRICS reigned supreme as the economies to watch out for. Given the fact that investors are always in search of higher yields and returns, it is natural for them to now focus on the next set of economies that would take the place of BRICS.
Moreover, with Russian growth reaching a plateau, South Africa bogged down with instability, Brazil facing its own crises, it can be said that India and China are the only economies standing in this grouping and hence, it makes sense for investors to hone in on the next economic hotspots.
This has led to the coining of the acronym MINT or Mexico, Indonesia, Nigeria, and Turkey as the next big thing as far as emerging markets are concerned. In addition, investors are also looking at Southeast Asian countries such as Vietnam, Central Asian countries abutting Russia and Europe, African countries apart from Nigeria, and Latin American countries as well.
First, let us discuss the MINT grouping in detail. To start with Mexico has the advantage of being the neighbor of the United States and this has given it an edge over other countries as far as the benefits from geographical location are concerned.
In addition, Mexico has abundant human resources, though, not necessarily high skilled, which means that it is an attractive destination for any global corporation aiming to cut people and labor costs. Indeed, this is the reason why many American firms setup their plants and factories there so that they can minimize on the labor costs.
Turning to Indonesia, it is a country whose time has come as far as being an emerging economic hotspot is concerned. Long dwarfed and overshadowed by its rich neighbors such as Malaysia, Singapore, and South Korea, Indonesia is a country that is on the cusp of an economic renaissance.
Though battered by the Southeast Asian economic crisis of 1997 that was a result of overcapacity and corruption, Indonesia has shaken the Ghosts of Past and is looking to join the league of developed nations, if not as a member of the emerging economic hotspots.
With well developed capital markets and a population that is conversant with Western norms of doing business, investors looking for opportunities certainly find them aplenty there. Moreover, it has also started competing with Thailand for the Tourist Dollars by investing in its infrastructure.
Having said that, it suffers from crony capitalism and corruption being legacies of the past and it remains to be seen as to the extent to which the government can address the concerns of investors in this regard.
Next in line is Nigeria, which in recent years, has been clocking high growth rates that have become the envy of most African countries.
Indeed, for a country that is in what was always considered as a Dark and Hopeless continent, Nigeria seems to be bucking the long held perceptions of African countries being good for extractive growth or in other words, of interest to global firms and investors seeking mining rather than high value addition.
Further, Nigeria also has the advantage of being a vital hub in Africa by becoming a gateway for foreign firms wishing to do business there.
In addition, and perhaps the most important aspect as far as investors are concerned, Nigeria is relatively stable in terms of political instability and social cohesion. Moreover, it has the advantage of a youthful population that is aspirational and a growing Middle Class more interested in economic growth rather than creating trouble.
The fourth emerging economy to watch out for is Turkey, which sits astride Europe and Asia and hence, is poised to reap the benefits of being in a strategic location. Despite recent instability on account of political and social factors, Turkey and its economy are powering ahead with many global firms entering the country to invest.
Apart from this, Turkey has a huge English speaking population that counts in its favor. Moreover, it has a long history behind it which means that Tourism is a sector that can contribute to its success as well.
Having said that, it is not only the MINT grouping which promises to be the next club of countries poised for higher economic growth, but also countries such as Vietnam, and the various stans (the term used to refer to the many countries in Central Asia whose names end with stan) are in the reckoning as well.
It goes without saying that these countries having economies that are yet to be saturated are the ones to watch out for as investors look beyond BRICS for higher returns.
Moreover, it is the nature of capitalism to be always alert and alive to the possibility of the Next Big Thing and this is what drives investors to seek continuous iterations of growth opportunities. Last but not the least is the very real aspect of how China is now overcapacity and India remains in its own orbit as far as investors are concerned.
To conclude, the MINT grouping and the other countries discussed here can be the lodestars for investors as they seek returns.
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