Emerging Markets

Advantages of Mexico as an emerging market compared to BRIC countries to attract foreign investment.

Introduction

All eyes of the media and companies are focused primarily in the BRIC countries (Brazil, Russia, India and China) as a possibility for investment and growth, but why not think of other countries such as Mexico? Taking into account variables such as relative GDP per capita, the share of exports and imports between other variables and making a comparison with the BRICs, Mexico can be a huge opportunity for foreign investment.

Emerging Markets

Emerging markets are those with a social or business activity in rapid growth and industrialization. Moreover, the emerging economies have shown not only growth, but also the best prospects for continued growth in the short and medium term. This emerging economies are undergoing restructuring and consolidating processes of their economies into new markets, with a wide range of services, technologies and investments, beginning to displace the traditionally dominant countries.

You can asked yourself what were the factors that have influenced this development process. One of the key factors that have driven this process is no doubt the globalization (processes that increase world-wide exchanges of national and cultural resources) which has led to some major changes in the way business and international markets, also the emerging markets has impacted connecting new global sourcing and procurement bridges, another factor would be the foreign currency reserves, International reserves.

These countries do not share a common agenda, but some experts believe they are enjoying an increasing role in the global economy and on political platforms c considering more than twenty emerging markets in the world, two with the most rapid and significant economic growth are China and India but also exist others economies emerging markets (BEM), in America are Brazil and Mexico, in Asia are China, South Korea, India, Pakistan, Egypt, Indonesia, Philippines and in Europe are Poland, Russia and Turkey, these newly industrialized countries are emerging markets whose economies have not yet reached the top world but in a macroeconomic sense, they have done more than their developing counterparts.

Investments in shares of companies in emerging markets may be the best option in the coming months and many investors around the world are already spending more and more money to developing countries .

According to EPFR Global, which tracks investment funds globally and based in Boston , in October 2012 stock funds emerging markets investments were U.S. $ 5,700 million compared to only 211 million the same month of 2011 .

" The main reason for the growing interest in emerging markets is the belief that China's economy is reaching its lowest point and begin to recover," he told AP , Cameron Brandt , director of research at EPFR Global.

"In the last two years the shares of U.S. companies have been the best investment even over emerging market equities and based on technical analysis we may be reaching a point where emerging markets are in new better investment than U.S. stocks , "he told AP JC Parets , technical analyst actions and partner at Eagle Bay Capital , Hedge fund manager based in New York.

Technical Analysis refers to the revision of the historical behavior of stock prices and capital flows from investors around the world , investors have had a good time with U.S. stocks . Return on funds specializing in U.S. stocks was 12.23 % annually over the past three years , which is much higher than in emerging markets was 4.98 % in the same period , according to data of Morningstar.com , a firm specializing in the analysis of funds based in Chicago , but in the longer term , emerging markets have been very profitable. In the last ten years , funds from emerging market equities have had an annual return of 15.3 % compared with 7.4 % of the shares of the United States, according to Morningstar.com .

For some time the case for emerging markets have been numerous. These are the countries where population and consumption is growing rapidly, their economies are also growing rapidly and also boast a wealth of basic goods ( commodities) as metals and food products have more demand in the future as it grows the world population.

In contrast , highly regarded analysts like Bill Gross, founder of PIMCO , one of the investment funds in the world's largest bond and Jeremy Grantham. , Chief investment officer of asset management firm GMO , have said that the good times of U.S. stocks are over and that the next few decades the annual return of U.S. stocks will not reach double digits as in recent years.

Given these dire predictions and the fact that the developed economies of North America and Europe are going through a severe economic crisis seems increasingly clear that global investors betting grow in emerging countries .

Currently, there has been a group of four emerging countries called by the high growth of their economies, began to have strong impact on the global economy, countries are Brazil, Russia, India and China, BRIC informally after the call so the Bank Goldman Sachs, these days China is already the third economic world power, and can grow more. Also in the BRIC countries, joins half the world's population, 23% of world GDP and over 40% of the planet's surface.

Advantages of the BRIC in the global economy.

Brazil

Brazil has become one of the major powers of economic growth, thanks to reforms to stabilize the economy by encouraging investment, belongs to the group of emerging economies along with Russia, India and China, media says that is posibbly the more atractive countrie to foreing investment.

The reason for the success of Brazil has been thanks to the measures of the ministers of economy in recent years, in 2003 began to implement strong measures in the monetary and fiscal policy to control inflation and somehow regain confidence foreign investors. Start by stimulating domestic demand in sectors with high employment such as construction and automotive industries, the goverment has created more than 2.5 million new jobs, increased approximately 7.5%, the state has been concerned with the consolidation of the domestic and foreign markets. Job creation in the most important sectors, rising wages and the most important: The fight against inflation.

Brazil's economy is characterized by an extensive and developed activities in the area of agriculture, mining, manufacturing and services, also created credits for Brazilian companies through Public Development Bank, its economy

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