The case for Emerging Markets external debt is solid. The long-term risk-reward has been and remains compelling. The outlook over the medium-term also favours the asset class as the unwinding of distortions in global bond markets attributable to Quantitative Easing strongly favour EM over developed markets. The near-term outlook is not without risk, but most of the serious external shocks with potential to derail EM have already occurred. Over the next five years, assuming no rally, i.e. no reduction in yields, we believe that EM external debt could easily deliver nearly 35% return in Dollars, with significant potential for additional return via alpha generation as the asset class continues to deepen and broaden.