Where To Invest In The 2020s

Western retail investors say that corruption in Southern Asian countries makes it too dangerous to invest, but most institutional investors accept corruption if there is growth to pay for it. Many older generations simply won’t adapt to this view though, but younger generations have a better understanding.

The BRI initiative is not about owning other countries through big loans that are at risk of being defaulted upon. Western colonial logic is not in play anymore. China’s focus is on protecting economic interests.

Western nations are critical of the involvement of the Chinese government in the private sector but are not realizing how advantageous it is to fast growth to have local government allocating economic resources to enterprises. The model has worked well for China, which does not mean that it’s replicable across other regions,

Capital Allocation Decisions Follow The Economics

The importance of effective capital allocation is also seen in the investment decisions for the five key disruptive industries. These are shown below:

Five key disruptive technologies for the future

The five key disruptive technologies for the future

All 5 industries and 30 sectors are critically important for the future, yet China decides to primarily invest in those with the most economic importance. Most sectors related to health, services, and biotechnology are being imported from other countries. The reasoning for this is very simple: these sectors require a large amount of capital spend, a high investment risk, a long R&D cycle, and slow commercialization. Hence it is easier to import them, as they are not as critical to economic growth as the others.

Different Ways In Which You Can Invest

  • Individual Chinese stocks that focus on artificial intelligence, e-commerce, and social networking: Baidu BIDUAlibaba BABA, and Tencent TCEHY
  • Alternatively, you can gain exposure to the BAT stocks through these two ETFs: KraneShares CSI China Internet ETF (KWEB) and Invesco China Technology ETF (CQQQ). The latter option is more diversified with twice as many holdings.
  • COSCO Shipping (1919:HK) and China Merchant Port Holdings (144:HK) own key ports along the 21st maritime silk road.
  • ABB Robotics ABB and Siemens AG (SIE: GR) are amongst the most disruptive forces in the Industry 4.0 revolution. China will heavily invest in more efficient manufacturing processes as a cause of rising wages.
  • ETFs for specific SouthEast Asian regions are the Market Vectors Indonesia Index ETF (IDX), the iShares MSCI Malaysia Index ETF (EWM), the iShares MSCI Thailand Capped Investable Market Index ETF (THD), the iShares MSCI Singapore Index ETF (EWS), and the iShares MSCI Philippines Investable Market Index ETF (EPHE).
  • The contestants are not just foreign companies. US industry giants Caterpillar CAT and John Deere DE produce the machinery to develop the infrastructure necessary.
  • Subscribers to Countach Research can download the PDF to see the list of Eastern European (most attractive), ME, and SouthEast Asian individual stocks, and their ADR tickers for US investors. Log in to access.
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