Templeton’s Mobius bullish on ASEAN

08 August 2014   Category: News, Asia, China, Global, Malaysia, Philippines, Thailand, Vietnam   By Derek Au

Veteran emerging markets investor Mark Mobius has said he is bullish on opportunities in South East Asian economies, despite political upheaval permeating the region.

Outlining his views on the outlook for Asian markets for the second half of this year, Mr. Mobius, Templeton Emerging Markets Group’s executive chairman, identified Thailand as one opportunity, despite the country reverting to rule by generals earlier in the year. “If you turn to Thailand, you would notice that despite all the political rhetoric and the political upheavals, stock markets continued to rise. And, when the military coup was announced, [the] stock market went up. So, we feel that the stock market in Thailand will continue to do quite well going forward,” he said.

Mr. Mobius singled out other markets in the region that have suffered instability in one form or another in recent months. “There are a number of other political events taking place around the region in Asia, the dispute between Vietnam, Philippines with China regarding the seas, [the] South China Sea. This is going to be an ongoing issue and will take many, many years to resolve. But, it really would not have an impact economically as far as we can see,” he continued.

In other parts of Asia, Mr. Mobius viewed Malaysia favourably as he saw there are “a lot of opportunities” due to growing trade among ASEAN countries, and its proximity to Singapore.

Mr. Mobius said he is not worried about the slowdown in the Chinese economy and revealed investments in the country top the list of his global portfolio. “Looking at China, China in 2010 grew by 10% and about US$800 billion was added to the economy. Last year, China grew by 7%, but $900 billion was added to the economy. So that you see, although there’s a deceleration of growth, the size of the economy of course has grown, and the amount of money being added to the economy each year is growing,” he added.

After a strong pick-up this year, Mr. Mobius expects that emerging markets will continue to outperform their developed counterparts. He said that the former have outperformed seven out of the last ten years. “And this year, so far, the emerging markets have surged ahead and are outperforming the developed countries. And we believe that is going to continue. The emerging markets will continue to outperform,” he said.