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The Emerging View
19 December 2013
Taking the long view
Global Frontier Markets are about to register yet another strong annual performance since the launch of
the MSCI Frontier Markets Index in 2003.
Frontier Markets are up 24%, while Emerging Markets (EM) are down 4% this year according to the
relevant MSCI index in USD terms. This strong performance, in what has been a challenging market
environment for Emerging Markets equity investors, illustrates just how uncorrelated Frontier Markets are
to herd-like market dynamics and the conventional drivers of global growth – whether in the local
economy or in corporate profits. It is important to understand how these returns have been possible and,
looking ahead, whether these are sustainable going forward. In our view, the answer is a resounding ’Yes’.