Macroeconomic trends show that best emerging countries to invest in are one of the ideal places for foreign investment. However, in light of recent events that have had a significant influence on the global economy, investing in the best developing countries remains the preferred option, and if a move to less developed countries is required, it is still vital to invest in the finest emerging countries. What are the typical risks to consider? And finally, which are the best emerging countries to invest in? Read more to find out.
How the Economic Potential is Measured
We often hear and read articles related to the best emerging countries to invest in, but more specifically, they’re referring to their economic potential. Many investors think that investment opportunities in countries can be very promising, but in fact, economic potential is a term that not everyone understands exactly what it means or what it includes. how to create that potential.
To put it simply, “economic potential” is a term that refers to the ability of a region or a country to support economic growth and development. Usually, these potentials are untapped. In economic potential, it mainly refers to factors such as human, financial, and material resources, sometimes including military economies, to ensure political stability so that the country can stabilize its development.
Is Investing in Developing Countries Always the Optimal Choice?
Investing in Asian developed countries requires huge amounts of capital, which is part of the reason that when investors consider potential countries to invest in, they often look to opportunities in developing countries. develop. Developing countries, often called “emerging economies,” often have fast economic growth and high rates of return.
However, investors must know that with high returns come greater risks, including some typical risks such as economic instability, exchange rate risk, etc. So in addition to direct investment, many investors now have other approaches to investing in developing countries, whether through indirect investment funds or considering investment opportunities in less developed countries.
Unique Opportunities and Risks when Investing in Less Developed Countries
Whether investing in developed, developing, or underdeveloped countries, there are certain risks. When considering opportunities in countries with potential for investment, some investors will consider even less developed countries. This can indeed be considered a bold consideration because it can be clearly seen that the typical risk when investing in LDCs is much higher than in the other two groups but that the return rate is low. much more than developed and developing countries.
The first risk to consider is a political one. Usually, the political system in less developed countries is considered weak, and the legal regulations are not yet strict. Although a few less developed countries have undergone structural and production capacity transformations, the COVID-19 pandemic has shown us more clearly about the resources and economic potential of these countries. The growth rate of the least developed countries has fallen to its lowest level in the last 30 years. (Comments from the Report of the United Nations Conference on Trade and Development)
Top Countries with High Investment Potential
Each investor will have their own view of investment opportunities in developed, developing, and underdeveloped countries. If you have followed the market for a long time, surely investors are no strangers to the fact that each year there will be different investment trends and industries. Even when assessing countries with the potential to attract a lot of people, it will also consider whether the country has any advantages in the new investment trend. Or for each industry, investors can rank the top countries in that sector to review investment opportunities.
Assess Investment Potential in the Vietnam market
Economies around the world also have policies to gradually adapt and become ideal for investment post COVID-19 pandemic, and Vietnam is no exception. If the pandemic gives us a better view of the risks of investing in less developed countries, it will also be a “test” for policies and the Vietnamese economy. Of all the countries with potential for investment, especially in Asia or Southeast Asia, Vietnam is always an indispensable name.
According to experts from international banks such as Landesbank Baden-Württemberg, with political stability, an adjusted monetary policy, loosening policies to attract investment capital, and an abundant workforce, Vietnam would The South is still one of the potential destinations for foreign businesses.
Want to know more about Vietnam’s market and industrial potential in 2023? Contact Savills Industrial today!