Research Library

Reduced financial costs, improved government finances and greater political will are now creating a very positive landscape for the Indonesian infrastructural space. Logistical bottlenecks have long impeded Indonesia’s growth trajectory.

We visited Brazil in January to refresh our view and investment ideas for 2012. The economy slowed considerably in 2H11 leading to a shock 0% GDP print for the 3Q. Industrial Production has remained stagnant, which coincided with a significant slowing of domestic demand.

We visited Poland briefly during the month. The economy is showing remarkable resilience in the face of the Euro crisis but does face headwinds. GDP growth has been running at a 4% clip which will likely slow to more like 2-2.5% in 2012, with a recovery in fixed investment (8% growth) offsetting substantial weakening in consumption (+3.5%).

We returned recently from a trip to India to assess the troubled macro environment in the country. There are certainly some quite serious concerns building – inflation has remained elevated at over 9% (according to the favoured WPI measure, almost certainly higher at the CPI level) while the sense of political paralysis has grown.

In the past month we visited Chile, Peru and Colombia to look for opportunities. We returned with a constructive view on the underlying fundamental story in each of the economies.

We visited Sri Lanka this month for the first time in several years. The country has made great strides since the end of the war in May 2009 and the peace dividend has been substantial. Around 2/3 of the coastline and 1/3 of the land mass has now been opened up for agricultural and industrial development.

We recently visited South Africa, trying to keep an open mind despite our negative preconceptions on the country as an investment destination. Political concerns remain substantial, with ANC Youth leader Julius Malema calling openly for land redistribution, apparently with little opposition from senior party figures.

We recently visited Croatia in search of investment ideas in what will be the latest EU member. The country is in a difficult position, yet to recover from recession following the global downturn with structural problems hampering any recovery. The economy remains plagued by high unemployment which is in turn undermining consumer confidence and a much needed rebound in consumer demand.