World’s top emerging markets named, but risks still loom

India, Indonesia, Kenya, Côte d’Ivoire, Peru, Chile and Bulgaria. These are the emerging market economies (EMEs) that have been identified as some of the world’s most promising new markets by economists at trade credit insurer Atradius.

These economies have been boosted by higher yields, reduced concern surrounding a hard landing of China’s GDP growth and a stabilisation of commodity prices.

Atradius head of regional brokered sales Richard Reynolds said: “The combination of strong consumption, investment-led GDP growth, increasing populations and improving policymaking offer attractive opportunities within these economies.”

The listed markets are predicted to weather global volatility in 2017 owing to strong domestically-driven growth, favourable demographics and supportive policy.

Each market is dominated by young, growing populations, marked by an expanding middle class which boosts consumption and increases demand for investment and imports, Atradius said.

As for the best performing sectors in the EMEs, food is driving Bulgaria, Kenya and Peru, retail is offering good prospects in Côte d’Ivoire, Chile, Peru and India, while demand for infrastructure and investment growth are fuelling opportunities in all of the top EMEs.

But Reynolds warned that businesses must be aware of the risks of trading with new markets.

“While the outlook for these EMEs is currently relatively benign, they are threatened from the effects of developments in the US such as interest rate hikes and any change to trade policies made by the newly inaugurated president which might impact currency depreciations and growth,” he said.

“In today’s economy, new global opportunities must be seized upon but the key for businesses operating in these new markets is protection. Businesses must be aware of the risks and take positive action to mitigate against them with robust risk and credit management strategies.”