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(Business & Finance Via Thomson Dialog NewsEdge) What's Hot ?
Up and coming countries such as South Africa and Brazil are being watched keenly by potential Irish investors, writes Stephen Tormey.
Despite a frustrating and difficult year in 2005, Pakistan is one country that is coming to the attention of foreign investors. Foreign direct investment in Pakistan increased from $484.7m in 2001 to $1.5bn in 2005, but the earthquake last October was a sever shock to the economy.
However, nobody disagreed with prime minister Shaukat Aziz when he said that "the earthquake may have a slight effect in the short-term, but will not rock the economy in the long-term."
In the shorter term, the challenges facing Pakistan are inflation and interest rates, but with a population of almost 166 million, the opportunities for foreign investment continue to attract attention.
Another upcoming investment hotspot is South Africa. Since its successful transition to democracy in 1994, there have been many positive economic indicators.
"Inflation is under control, foreign exchange reserves have increased tenfold, positive real GDP growth has been recorded for nine years in succession, and strong growth has occurred in fixed capital formation, to name but a few," says Colin Beggs, CEO of PricewaterhouseCoopers in South Africa.
The Irish economy has come a long way in the past three decades. Attracting some of the world's top multinational corporations, and fostering a strong indigenous entrepreneurial culture has been a prime objective of successive governments.
This positive attitude has developed Ireland into one of the world's leading economies. According to Kim Iskyan, head of research at MDM Bank in Moscow, "Ireland is one of the world's wealthiest countries, since its economy has grown nearly five-fold since 1973. It boasts one of the world's highest levels of GDP per capita, some 20% above the European average, while 30 years ago it was 35% poorer than the average."
This has created a cloister of entrepreneurs with a mass of wealth, looking to exploit business opportunities as they arise.
Indeed, Ireland has seen even middle-income earners transform themselves into investors, as attractive investment opportunities overseas lure them into the entrepreneurial arena.
There are a number of investment hotspots around the world where investors are focusing their attention, and this has as much to do with favourable tax regimes as prime real estate opportunities.
Infrastructure, low energy costs, a diversified economy along with sound fiscal and monetary policies. While the World Development Report of the World Bank showed that costs of unreliable electricity and fragile infrastructure are serious deterrents to foreign investment, Risk Map 2005, released by Control Risks Group in London, describes South Africa's business environment as positive, with "low political and security risk."
Another country that is held back by serious deficiencies but is nonetheless - emerging as a world economic player is Brazil.
Enterprise Ireland has hailed Brazil as the second most important market in Latin America after Mexico, and with prime investment opportunities & in the agri-food sector alongside potential in other sectors from telecoms to generic pharmaceuticals, Brazil could become a very real challenge for the world's top economies.
Over the past decade, the country has emerged from a vicious cycle of booms and busts, and finally seems to have controlled inflation, down from an astronomical 2,491% in 1993 to a modest 7.6% in 2004, according to Enterprise Ireland.
The 'new' Brazil is also meeting its IMF targets, is starting to come to grips with corruption, and has stronger democratic institutions as a result.
Interestingly, in a survey released by the UN in September in 2005, multinational companies rated Brazil the fifth most attractive business location worldwide, lagging behind only China, India, the US and Russia, so potential Irish investors would do well to watch this space.
While economies like India and China surge ahead, these less-hyped investment areas are offering attractive investment opportunities across a range of sectors.
It is easy to be attracted to huge investment hubs, but all that glitters is not gold. While these hives of economic activity have assisted some companies expanding at phenomenal rates, less developed areas such as South Africa and Brazil have the Irish investors would do well to watch this space.
While economies like India and China surge ahead, these less-hyped investment areas are offering attractive investment opportunities across a range of sectors. It is easy to be attracted to huge investment hubs, but all that glitters is not gold.
While these hives of economic activity have assisted some companies expanding at phenomenal rates, less developed areas such as South Africa and Brazil have the potential to become significant players in the global investment market potential to become significant players in the global investment market occurred in fixed capital formation, to name but a few," says Colin Beggs, CEO of PricewaterhouseCoopers in South Africa.
Irish investors would do well to watch this space.
While economies like India and China surge ahead, these less-hyped investment areas are offering attractive investment opportunities across a range of sectors.
It is easy to be attracted to huge investment hubs, but all that glitters is not gold.
While these hives of economic activity have assisted some companies expanding at phenomenal rates, less developed areas such as South Africa and Brazil have the potential to become significant players in the global investment market.
Copyright 2006 Belenos Publications Ltd Source: Financial Times Information Limited - Europe Intelligence Wire.
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