Can Emerging Market Growth Continue to Reshape the Global Economy?
'We've only begun to see the impact they will have in the financial
markets'
By Jeffrey D. Voudrie, CFP
Feb. 11, 2008 - We've all heard about the amazing growth taking place
in developing countries and how the global economy will never be the
same again. But countries like China, India and Vietnam seem so far
away. It can be hard to understand how those marketplaces can affect
the individual investor here in the U.S.A. After my recent trip to
Cambodia, I'm here to tell you that emerging markets aren't some short-
lived fad. We've only begun to see the impact they will have in the
financial markets.
My wife and I had visited Cambodia last March, but this time was
different. Besides having our four children along for the experience,
the signs of a growing economy were everywhere.
Construction was taking place all around Phnom Penh, the nation's
capital. A new 42 story office building had broken ground, the
country's first skyscraper. It's being financed by a South Korean
company. A huge new complex of shops and office buildings were coming
up on old rice fields north of town in a special economic zone.
M***** of new apartment buildings were being constructed. The prices
of these condo/apartments continue to increase. Those that were
$40,000 when construction started are now $100,000.
Land values continue to soar exponentially. More people can afford
cars. Everyone has a cell phone. Universities and schools teaching
everything from nursing to English cl***** to management and computer
skills are popping up on every corner. And the schools are packed.
The city continues to improve its infrastructure with the paving of
roads and improvement of their drainage system, which is im****tant
during the monsoon season. Internet access is growing as is the
availability of cable television.
But there's much work to be done. Power outages occur almost daily.
The municipal water isn't potable. The sewer system has a very limited
reach. There is no mass public trans****tation service in a city of
well over 1 million. There's little garbage collection.
Just outside of town, the picture is even starker.
When you travel out to the provinces, it's like stepping back in time.
Once you get off the main highway, there are no paved roads. Many
homes are simple wooden shacks with thatch roofs. ****d children play
with sticks in the road next to ditches that are little more than open
sewers.
Electricity comes from generators that operate a few hours a day.
Health care is almost non-existent. The rice grown in the fields
hardly supplies enough grain for each family's yearly needs.
Not all provincial families live in dire poverty. But the majority
do.
The young people don't want the same life their parents have. They
want more. And they're willing to work for it. Many of them turn to
the garment factories, where by working six to seven days a week, ten
to twelve hours a day, they can make $100 a month. In country where
unemployment can reach 50%, that's a nice sum of money. But it's not
much of a life.
Others realize that education is their ticket to a better future. The
church we visited and were working with offers free English and
computer cl*****. Over 200 students jam every available room of the
building four nights a week.
In addition, all of these kids attend either high school or university
during the day. Many of them came from the provinces and plan to send
money they earn back home to help sup****t their families.
So if you think the emerging markets' is just the latest financial
talk point, think again. The story in Cambodia is the same story all
over Asia.
These people want a better life. They want a higher standard of
living. They are becoming educated. Their countries are only beginning
to improve their infrastructure. Astute companies from around the
world are investing big bucks into these economies. And the growth is
only going to increase.
This isn't a five year fad. It will take decades for these countries
to grow into modern nations. But there's no going back. The young
people we met are determined and focused. This generation will do what
it takes to succeed.
Your generation worked very hard to achieve financial security. In
today's changing global marketplace, you'll have to invest smarter in
order to maintain it. In next week's article, I'll give you practical
steps to take advantage of the op****tunities these emerging markets
provide.
If you have a specific question or would like more information, give
me a call toll-free at 1-877-827-1463 or you can also reach me by
email at jeff@[EMAIL PROTECTED]
I will answer your financial
question FREE.
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