Emerging markets lose investors’ confidence

23/05/2016

AT Kearney (May 2016)

The recently published 2016 AT Kearney Foreign Direct Investment Confidence Index shows that investors are turning their attention to developed economies in North America and Europe because of profound uncertainty in many emerging markets. As recently as 2013, emerging markets comprised more than 50% of the countries on the FDI Confidence Index, and they accounted for about 70% in the 2010 edition. In contrast, in 2016 it is developed markets, not emerging ones, which capture 8 of the top 10 spots and account for 80% of all countries included. Reasons for this lack of investor confidence are seen in China’s sub-7 percent growth, near economic meltdown in Brazil, the continued commodity slump, a very strong dollar, and volatile equity markets.