Monday, September 21, 2009

President Arroyo talks about the potential and strength of Southeast Asian Tigers in General and the Philippines in Particular

One of the stocks that is chosen in more than one of our Emerging Markets model portfolios is San Miguel from the Philippines. It is part of the EM Next-11 and the EM Winner- portfolios. A few days ago the president of the Philippines, Mrs. Gloria Arroyo gave an interesting presentation at The Economist's Emerging Markets Conference at the Park Plaza Riverbank Hotel in London.

Southeast Asian economies in general were relatively Crisis-insensitive during the last 1-2 years. Their strong ties with global power houses China and India were an important positive factor. But there is more. In her address, Mrs. Arroyo also stressed that her country - The Philippines - did also benefit from the strong domestic market where private consumption growth has become a true growth engine.

Listen here to her address:

We have more stocks from the region in our portfolios next to Philippine San Miguel, the largest food, drinks and packaging conglomerate in Southeast Asia , like:
  • Sime Darby (Malaysia) - EM Winner Portfolio
  • Telekom Indonesia (Indonesia) - EM Winner Portfolio & EM Next-11 Portfolio
 On San Miguel we realized a total return of 7.03% since the start of our model portfolios on Aug 28. Telekom Indonesia was less successful with a mere 1.22% growth. Sime Darby went up 4.12%. Comparing this with a 7.92% benchmark return (Emerging Markets) and 4.14% (MSCI World) we don't really see spectacular results yet for this region that suffered least during the crisis. However, fundamentally Arroyo stresses - and we believe correctly so - that the linkage with two of the BRIC's and the region's internal power make these old Tigers (the word Tiger economies was initially used for Southeast Asian nations like Singapore) strong anchors in the portfolio.

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