A recent report by Acclime has given a fascinating insight into emerging APAC investment markets which are expected to outperform over the next two decades. While many of those on the list will be unsurprising to those following APAC investment markets, there are some interesting entries. Even though the region as a whole is expected to grow significantly in the short to medium term, there is still some scope for discretion regarding allocation to individual markets.

 

Top eight emerging markets in Asia

 

The top eight emerging markets in Asia, according to the Acclime report - together with IMF GDP ranking, ease of doing business score and global innovation index ranking - include:-

 

· China (2^nd, 31^st, 11^th)

· India (5^th, 63^rd, 40^th)

· Indonesia (16^th, 73^rd, 75^th)

· Thailand (27^th, 21^st, 43^rd)

· Vietnam (34^th, 70^th, 48^th)

· Malaysia (35^th, 12^th, 36^th)

· The Philippines (36^th, 95^th, 59^th)

· Cambodia (109^th, 144^th, 97^th)

 

While many of the above countries have various traits in common, much of their short, medium and long-term potential is focused on critical social and economic indicators. Many believe these indicators create the foundations for strong economic growth.

 

China

 

Many will be surprised to learn that China is still classed as an emerging economy despite having one of the largest economies in the world. This country dominates the APAC investment market scene due to its size and trading power. Regarding GDP, China is expected to overtake the US by 2028.

 

India

 

India is another significant component of the APAC investment market, with the country's rise traced back to the 1991 economic reforms. Economic growth averaged 7.1% over the last decade and is expected to hit an average of 8% in the medium term. India has the largest population in the world, and there is still significant untapped potential.

 

Indonesia

 

Even outside the APAC investment market, Indonesia is expected to become one of the global powerhouses in the short to medium term. Coming towards the end of a 20-year government development strategy, the Indonesian economy is expected to be the fourth largest in the world by 2045. Considering its position of 16^th at the moment, this would be a phenomenal achievement!

 

Thailand

 

Amongst APAC investment markets, Thailand is expected to show significant growth in the medium to long term. The private sector has become the main growth area with an interesting split in GDP, industrial sector at 40% and the services sector at 50%. The country has a relatively strong financial services industry which bodes well for the short, medium and long term.

 

Vietnam

 

Vietnam has been one of the stars of the APAC investment market in recent years, registering significant growth and an economy with solid foundations. Massive investment in the digital revolution has helped domestic businesses and continues to attract substantial foreign direct investment. While impressive growth figures in recent years may slow in the short to medium term, it is the solid foundations that many experts are highlighting.

 

Other countries

 

Looking at the other countries in the emerging market list, Malaysia, the Philippines, and Cambodia, one thing is evident; they have all instigated long-term economic development programs. Many of these are now coming to fruition and attracting significant foreign investment.

 

Summary

 

Overall, the APAC investment market is set to grow significantly in the short, medium and longer term, led by China but ably supported by other economies. If expectations are fulfilled, the ongoing switch in the balance of trading power is set to continue for some time to come. As a result, APAC investment markets will become a significant asset play for any investor.

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