Copy of e.a.g.l.e - i (1)

Transcript

Matt Jones

Welcome to Idea Jeneration with Stephen Jen, a podcast series offering insights into long-term themes within global markets.

This is a production of Eurizon SLJ Capital, and has been recorded for professional investors. My name is Matt Jones, Head of Distribution for Eurizon SLJ Capital.

In this episode, we ask Stephen Jen the question, is the term 'emerging markets' now outdated?

Stephen Jen

I wonder if the term 'emerging markets' is badly outdated - because of China. China is now very big. In terms of size, the nature of its economy, its economic performance, the performances of its companies and policies, China stands out; China is so different from the rest of EM. So the main point here is really that emerging markets ought not be considered in the aggregate, as we have been doing the last 10, 20 years - but we should carve out China.

You're familiar with the term 'BRIC', which was very popular, I would say 10, 20 years ago, but these days you don't hear that term being mentioned anymore. It just quietly faded. And there's a good reason. In the last decade, the other three economies in the term BRIC - Brazil, Russia and India - have collectively generated a growth rate, cumulative growth rate, in their nominal dollar GDP of zero. In the whole decade, their nominal dollar GDP has not increased.

The reality is that if you split off China from emerging markets, you get a completely different picture. My point here is that the beta the rest of EM has exhibited relative to the GDP of China has declined in the last decade. And my guess is that with the pandemic shock, this idea of a K-shaped recovery in the world, across sectors, should be applied to the EM countries as well, because their industrial makeup is completely different.

Matt Jones

Further information can be found within the episode description, and more insights are available at eurizonsljcapital.com/insights.

The views expressed within this podcast were accurate as at the time of publication. Opinions expressed by the speakers are their own and do not necessarily reflect those of Eurizon SLJ Capital Limited, Eurizon Capital SGR or the Intesa Sanpaolo Group.

Source

Audio taken from the Capitalmarket.events web conference Emerging Market Perspectives, recorded on 21st April 2021

Disclosure

None of the contents of this document should be understood as constituting research on investment matters, or as a recommendations, advice or suggestions, implicit or explicit, with respect to an investment strategy involving the financial instruments discussed, or the issuers of the financial instruments, nor as a solicitation or offer, nor as consulting on investment matters, of a legal, fiscal, or other nature. All the companies of the Intesa Sanpaolo Group, its administrators, representatives, or employees, decline any responsibility (fault-based or otherwise) deriving from indirect damages potentially caused by the use of this communication or its contents, or in any case deriving in relation to this document, nor may they be consequently held liable for any of the above. The information provided and the opinions contained in this document are based on sources considered reliable and in good faith. However no declaration or guarantee is offered by Eurizon SLJ Capital Limited, explicitly or implicitly, on the accuracy, exhaustiveness and correctness of the information, and there is no guarantee that results, or any other future events, will be compatible with the opinions, forecasts, or estimates contained herein.

Views accurate as at the time of publication. Opinions expressed by the authors are their own and do not necessarily reflect those of Eurizon SLJ Capital Limited, Eurizon Capital SGR or the Intesa Sanpaolo Group.
The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. Past performance is not a guide to future performance.

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