Parts 1 and 2 of this three-part weblog
set forth the idea that Europe may seek to rebuild its economic
strength by undertaking a dual-aspect regional agenda. Setting forth
a template which attempts to circumnavigate the expectant
hyper-competitiveness of mid-value mass-manufacture between the USA
and the BRIC nations.
European “Core Path...-
The primary aspect of Europe's much
needed revitalisation of course relies upon necessary progression of
its global competitive advantages - across the sciences, R&D, and
high-value manufacturing and services. So as to continually create
'mid and far horizon' technologies and activities for both its own
good, and that of EM powerhouse interests; thereby drafting
'tomorrow's world'.
...Plus “Peripheral Path”
However, investment-auto-motives also
believes that this continental norm should be conjoined by a new
focus on those nations that sit beyond the BRICs and CIVETS. So
embracing those demographically, culturally and politically positive
prospects amongst the plethora of remaining but yet far from fully
matured 'bottom-tier' countries.
[NB see accompanying diagram]
The EU and a true “3-Speed” World -
Whilst it is ridiculous to think of
core and periphery Europe as two distinctly separate regions, whilst
there are still undoubted cultural differences between north and
south, the fact is that since the early phase of the industrial age
nations have been technically and economically intertwined: the
auto-industry and the Euro prime examples.
Yet today, the consequences of the
financial crash and the sovereign debt crisis have undoubtedly had a
geo-economic effect, and has re-cast the previous status quo. This
new era has obviously created critical questions regards policies for
European growth. Some periphery nation governments appear to believe,
or at least infer, that Germany wishes to create a teutonic
supra-state using the EU mantle; the negative reaction to the
austerity drive sought for German biased EU financing. In turn, the
Germans seek a stable, value-adding Europe within the global context,
within which the teutonic model, unlike many others, clearly shines.
The required solution to this challenge
will inevitably require in its basic form a SWOT analysis of Europe
'as is' and 'as was', so as to appreciate how what is presently a
2-speed Europe can properly integrate beyond the (IMF's) 3-speed
world. (US, prime EMs and EU) [yet recognising the trueism of a 4-Speed world
which includes the worst performing 'bottom-tier' EM countries].
It has been ascertained that the US and
BRICs will vie (and collaborate) over the massive global
middle-ground in manufacturing, whilst obviously the former will seek
to retain leadership in defence, the internet, bio-sciences,
intelligent transport and 'earth sciences'.
Europe must therefore recognise where
it can function as single entity with the remit of purveying the
'global public good', doing so en-mass and via its individual member
states, acting individually or as similarly placed sub-groups.
To this end investment-auto-motives
proposes that a policy format be examined, with specific focus on
periphery countries, by which “member states be steered toward
global gates”. That is to say that the strengths/competences of
such countries, both today and specifically from their own historic
pasts, be re-recognised and utilised.
Yesteryear's Progress...-
It is suggested by investment--auto-motives that the Post WW2
reconstruction era serve as an impetus for periphery countries' own
modern-day reconstruction efforts, with past and new
learning/solutions being exported to those high-potential
'bottom-tier' emerging countries. In effect a re-deployment of the
European industrial lead gained over the last 70 years of so, perhaps
the best of which was seen in the 'reconstructional spirit' during
the late 1940s, 1950s and early 1960s.
Yet also recognising that aspects of
that knowledge lead have indeed been diluted as the larger EM nations
went through their own development process, the results of which
empowered them to assist the bottom-tier nations, whether neighbours
or far overseas.
Both the post WW2 period and the
1960s/70s saw an 'export or die' fervour, Britain's directed to the
Commonwealth and newly entered European Common Market (as a new
member), with Germany directed to the USA, general Latin America and
Africa, and Italy focused upon Brazil. This was primarily regards the
technology transfer of capital goods and consumer goods, those
efforts partially replaced today by a new set of EM exporting and
substantial FDI nations. Hence, the uni-directional export model has
been replicated by those arguably better placed geo-politically (if
not technically) and so must be evolved.
...With Entrepreneurial Twist -
This means creation of an alternative
model that is equally hinged around the abilities, achievements and
potential of those countries' human capital.
Since, as stated the capital markets of
many (though not all) 'frontier countries have seen large inflows of
western cash, with local investment managers presumably seeking to
stream-line corporate operations and boost earnings; the time may be
appropriate to consider a specific focus upon local entrepreneurs.
The sons and daughters of the local
political, financial and corporate elite often pre-figure as local
entrepreneur given their wealth and connections, power typically
residing in the hands of specific families generation after
generation which protect their interests.
Typically, such poor but ambitious
people are usually observed by the local elite. First cajoled into
false friendships, then operationally undermined (sabotage), then
stated that the only access financing, market share and protection
from 'accidents' only if “on side”. Truly socially repugnant, and
damaging to the broader economy. After all, their purses may be far
smaller, but their business acumen often far more pronounced.
[Of course a similar, often more
psychologically biased, process is experienced in so called developed
nations; outwardly decent people wholly disingenuous in their
actions].
All of this has a broader the
strangulation effect, unless cultural and regulatory reforms can be made.
So in this instance, whilst the
influence of the local elite is undeniable, it too should be
convinced that the overall economy gains from the inclusion and
support of small time 'ghetto entrepreneurs'. People though with few
personal “gonnegtions” (to quote a character from The Great
Gatsby), have built their business from scratch, through “blood,sweat
and toil” (to quote Churchill).
A Closer Look at the 'Frontier Fringe'
-
Once again the FT recently laid out a
useful overview of how liquidity has been fed into many of the so
called “frontier economy” nations by so-called sophisticated
investors looking for improved yields in a generally low yield world.
This small but increasingly influential investor base – typically a
representing the accumulated small portions of larger funds - seeking
strong value amid a low-growth West and recognising the affect of
slowed BRIC economies on portfolio returns.
Thus it appears that record sums have
been directed at the lower-risk end of 'exotic' targets; most
typically the fixed-income instruments of government bonds given
relative safety.
Equities likewise have seen massive
popularity in certain countries, with the Philippines and Thailand
bourses out-performing the broad MSCI index by significant levels,
high p/e values driven by western liquidity seeking better returns.
Of real note has been the marked
reduction in government borrowing rates seen by various 'frontier
countries'. Many having shrugged-off past PESTEL malaise, then seen
in high government borrowing costs, and today the most appealing not
too far behind some of Europe's periphery nations. Seemingly the
result from a combined effect of improved fundamentals (often
assisted by the decade-long 'China-effect), a high supply of investor
liquidity, and worsened ROI conditions across major countries.
[NB Whilst general macro trends tend to
be on a regional basis, thus encompassing a similar array of close
proximity countries, each and every country is obviously a specific
case given specific local conditions].
However, if it is ascertained that
truly new and sustainable foundations have been established in
specific 'frontier' government debt markets, viewed via stable
economic indicators, themselves typically derived from strong-hold
domestic industries (ie agriculture, mining, processing, tourism and
consumer staples), then (even at this low point of the global
commodities cycle) it would appear that an economic framework has
indeed been created to support a virtuous circle of growth.
Such growth providing the fertile
conditions for small-scale business people – the 'ghetto
entrepreneurs' - within what should be an emergent and burgeoning
private enterprise realm.
Whilst over the past 5 years the
western world has been focused upon the repair of its complex,
inter-connected financial system and the reduction of over-leveraged
public and private sectors, with efforts to create new economic
fundamentals, a very different story of apparent commercial strength
has emerged across (Sub-Saharan) Africa, the CIS, Asia and Central
and Latin America.
Small, but densely populated Rwanda was
recently used in an FT presentation to exemplify such an “African
Tiger Economy”. Twenty years on from civil war, the last decade has
seen an average growth rate of an impressive 9% per annum, on-par or
out-pacing many of the far more renowned EM countries. For the
reasons previously mentioned (apparent national stability, a trounced
west and sea of liquidity seeking a home) Rwanda recently received
order offerings of $3bn for its ten year bond, with a coupon of
6.875%; this not so far from Portugal's 5.7% coupon.
[NB However, investment-auto-motives is
concerned that the massive $3bn subscription level (half the national
GDP) may have the hallmarks of a bond-bubble].
Any similar story for 'frontier
economies' means that investors must be convinced of their respective
economic growth stories, which not only theorises a balance of public
sector vs FDI vs private sector spending; but sees it in practical
action.
The historical and trending stability,
or not, of the local stock-market, and its innate rebound effect,
should provide a typical guide to overall economic strength, yet it
must be recognised that 'immature', sector weighted, bourses typical
experience higher volumes of speculative trades which drive such
markets]
The China Effect -
Nonetheless, with this proviso
established, it was undeniably the arrival of China's 'quid pro quo'
trade agreements with small EM states – itself often based upon an
“commodities for infrastructure” exchange – by which the
necessary physical foundations for improving many local economies
were established. By way of much improved and new ports, roads,
railways, telecoms, warehousing, trucking etc. This FDI accompanied
by the usual offerings of official state aid, soft loans etc.
The exact quantity of Chinese trade and
assistance to African nations appears questionable. One recent source
states that $75bn was provided for formal projects over 2000 to 2011,
yet unofficial projects amassed to $260bn over the period. Another
academic source states that this is wholly inaccurate; exact figures
rarely examined deeply given the time and effort required for true
field research, especially when media deadlines loom.
Nevertheless, whatever the exacting
reality, such Government-Sino project employment has put money in the
pockets of locals, those new incomes creating an expanded arena of
general local commerce, ranging from clothes to bars, from
supermarkets to cars (themselves often 'grey imported' Japanese,
European and American models).
It is also noted that a sense of
free-market competition was also introduced whereby a small but
significant ex-pat Chinese population sought to become local economic
actors with interests ranging from chicken-rearing with market-stall
sales to the sale of Chinese made goods, from toys to generators.
Western Catch-Up -
Obviously whilst the relations between
such EM countries and China have been at times fractious given
balance-of-power issues, the plethora of international couplings
created by Sino-EM projects and resulting economic integration has
presumably been concerning to a shrunken, and only recently regained,
West.
With this recognised, and with an
inferred expectation that Europe seeks not to be over-shadowed by the
US, it should be necessarily keen to re-integrate with smaller
nations.
This is perhaps why, in the footsteps
of great Swedish statisticians, the free to browse 'fact-site'
GapMinder.com has been created, by the engaging yet modest Hans
Rosling. Himself seeking to promote the applied statistics behind the
theorum of a 're-balancing world' – where the East regains equality
with (and possibly surpassing) the West (after a thousand year
hiatus).
[NB He points out that some of those
underling countries have better population health statistics than the
West, such places seeing a balance of dietary intake versus calorie
burning, this presumably predicated on greater physical exertion.
Exactly whether such countries are able to avoid the over-weight and
obesity as incomes rise to provide ever more physical convenience
remains to be seen].
Led by the UK, cash strapped western
nations are now seeking to reduce and remove increasing foreign aid
monies. As regards South Africa (and no doubt with others) it is
perhaps rightly argued that any country with proven wealth creation
capabilities ought to take on greater responsibility for its own low
and non income earners. This approach subtly yet publicly stated by
Japan recently as it seeks more constructive relationships, with
Africa especially, akin to that which has benefited China.
The timing of the triad countries
seeking a 'better deal' appears strategic given the economic slowdown
in China and the expected consequential effects upon the strength of
Sino-African relations.
Re-Discovering and Exporting the
Re-Construction Spirit -
Today 'austerity' has become the byword
across Europe from Ireland to Greece, at a level perhaps not
experienced since the privations of WW2 and its aftermath. It was
then essentially a re-developing continent with a re-construction
agenda, arguably stymied by the restrictions of the gold standard to
pump-prime national economies. Though with more flexible monetary
levers today, governments must still carefully balance cost-base
relative to liquidity, critically creating a sound economic platform
by which the two may generate true investor appeal.
However, as mentioned in previous
posts, investment-auto-motives believes that Europe can re-learn the
lessons of old, and in the 21
st century re-apply them not
simply within the region but across those places in the rest of the
world that sit below the BRICs and various CIVETS.
Germany of course was forced to quickly
re-invent itself, banned from military engineering the efforts of the
day were directed toward affordable products; names like Messerschmitt
and Heinkel adorning the micro-cars of the time which, like Italy's
Vespa scooter and sibling Ape 3-wheeler, sought to provide mass
mobility and revitalise a depleted economy.
In 1948 Britain's Rover Car Company
provided the original Land Rover (today Defender), itself derived
from the rugged simplicity of war-time Willys and Ford Jeeps, but
with even greater utility applications for agriculture and
construction projects worldwide. France was able to initiate mass
production of the Deux Chevaux, a true 'town and country' car.
Slightly later specialist manufacturers such as Austria's Steyr
Daimler Puch were able to create for their own needs, thus the small
multi-purpose 4x4 Haflinger emerged primarily for steep gradient
agricultural and forest work.
Whilst these names have been enshrined
in automotive history, similar efforts were apparent elsewhere across
Europe, all assisting in regional, national and the European growth
story. Yet of intrinsic interest was the manner in which the small
and new enterprises of a far more financially starved Southern Europe
was able to flourish through practicality and determination; best
seen in the synergies of agricultural fields and local light
industry.
Practical Low Cost Innovation -
1. Re-Deploying the Proven Past
Italy's BCS Agricultural Equipment (now
BCS-Ferrari) [no relation to FIAT] is a good example of the pragmatic
and evolutionary ingenuity those serving the farming folk.
The firm was founded by Luigi Castoldi
to offer basic but robust small holder/small farm equipment.
Thereafter, as is typical, success saw the firm's size grew and as it
acquired other Southern European companies its products became more
generically task dedicated. But perhaps its creative and socially
relevant pinnacle came with the creation of its modular powered axle.
Similar one-person operator products
had long been in existence since the turn of the 20
th
century, with answers to specific rotovating,cultivating and mowing
needs. Yet BCS sought to amalgamate functionality by expanding the
range of tasks its powered-axle could undertake, via the attachment
of various ancillary items. In its basic form, operated by a walking
person via handlebars in rutted ground, or by the attachment of a
trailing seat for better comfort upon flat ground.
But at a time when even old small
trucks and cars were either unavailable or too expensive (given
rarity) and newly created vehicles very expensive, the beauty was
that the drive axle could be attached to the rear a BCS 'truck bed'
(or indeed a home-made platform) and driven from the front of the
vehicle; its small size able to traverse hill paths and country
lanes. In its vehicular entirety it was/is known as the Carolina and
is a much admired and loved item to this day.
That basic two wheeled piece of
machinery (akin to a traditional small tractor's rear axle, without
3-point hitch) has been mimicked by others in EM countries ever
since, today many regional manufacturers offering similar items, with
the exception that usually the power unit is placed at the front to
ease direct steering and linked either directly or via an articulated
swivel joint to the trailing platform; some even offering a coupled
4WD system.
Prior to WW2 agricultural equipment
development had been slow, commerce more interested in mergers and
acquisitions to obtain market share, and only truly boosted by
Britain's Harry Ferguson inventing the 3-point hitch applied to the
'A' and TE20 models, itself a postwar phenomenon.
In effect, the BCS Carolina provided
the kind of productivity advantage for Southern European
small-holders, as the TE20 did for worldwide large farms.
Whilst we are many decades on from that
time, and indeed agriculture in many larger EM countries is already
on a massive scale demanding big machinery, there are still very many
agricultural small-holder based societies that would benefit from
affordable (cash or micro-credit procured) adaptable equipment.
So herein is a yesteryear solution that
still has relevance and great appeal, either to full-time,
market-garden growers, and perhaps especially so to those whose
family members are themselves village to city and return migrant
workers.
A proven solution awaiting contemporary
re-applications
Practical Low Cost Innovation -
2. Evolving the Pragmatic Present
An ability to adapt and innovate has
always been a matter of fact in low income 'bottom tier' societies.
Everything has a value, whether it be functional or monetarily; the
most prized being both. Unsurprisingly, the prevailing attitude is
that “needs must”, “make do and mend”, “recycle” and
obtaining “maximum value for minimum cost'.
Beyond the immediacy of food, shelter,
clothing and cultural artifacts, the transportation of people and
goods takes priority.
Vehicles of all types have, since the
earliest horse-drawn times, conveyed a sense of personal pride to the
owner. The more rarefied or socially meaningful the vehicle the more
self-worth is attached. It comes as no surprise that their
exclusivity in lower-tier nations means that invariably the vehicles
themselves become 'canvases' upon which the owner/driver paints and
decorates (usually) his personal interests and signifiers.
Given the primary roles of trucks and
buses in transporting goods and peoples within emerging countries,
the innate social cache and monetary value of vehicles, ever since
the arrival of those first vehicles from the West, customisation has
been endemic; especially so for the culturally superstitious.
Privately run 'independent' trucks and
buses have for decades been adorned with good luck charms and
socially relevant pictorials. Of the former, in near-eastern places
the age-old 'evil eye' to ward off bad luck, and in middle and
far-eastern climbs the original swastika (suastika) to enhance
well-being, itself adopted from temples and homes.
The desire to customise – at whatever
available level - has long traditions, and spans the world:
- Long distance hauliers of Pakistan,
Afghanistan and N.India with 'Jingle Trucks'
- 'Dressed' Tractors hauling fruit and
vegetables to market.
- Music blaring 'graffiti-art' public
service Matuta mini-buses in Kenya
- Town and Rural hop-on/hop-off
Jeepneys of the Philippines
- 1950s American cars as 'personal
taxis' in Cuba
- Unregulated car-based taxi-cabs
throughout many EM cities.
- Many regulated taxi-cabs across the
EM world with not so subtle personalisation
- 3-wheeler Rickshaws and 'Tuk-Tuks'
that buzz with loads and people
- Motorcycles with side-cars that
perform the same role.
- Scooters pulling mini-trailers
- Bicycle rickshaws
[NB investment-auto-motives says “viva
la difference” given the vehicle's contribution to local cultural
iconography and the general street-scape. Why be '1
st
world' clinical with the homogeneous 'yellow-cab look' when the
vehicles transmit so much local flavour. To all authorities that seek
to regulate: enforce safety standards and good driver discipline, but
retain the personality.
Remember, the desire for regulated yet
idiosyncratic public and private hire transport also seen in the
London Black Cab, London Routemaster Bus, previously the New York
Cab, Brazil's 'missing seat' VW Beetle Taxis and Cuba's Havanna
'CoCo' shell shaped trike tourist taxi].
Thus we see that the pride of ownership
and cultural norms invariably lead to personal customisation, the
formula of which is generally a permutation of influences: interests,
social reflections, belief systems, proverbs, heroic figures and
aspirations.
Of course as people's incomes rise they
seek to improve their lives with newer products and vehicles, and in
Central America this has come to pass with the Colombian 'Yipao'
(Jeepao) [Willys Jeep], which has in reality become little more than
a heritage spectacle for independence day celebrations.
However, the endemic culture is still
seen elsewhere.
Whilst municipal authorities seek to
improve local transport networks with increasingly modern and
contemporary looking officially liveried vehicles, and there is often
mixed local opinion, such efforts are typical resisted by not only
those with business interests, but many of the local folk who foresee
inflationary pricing resulting from lost inter-competition.
For the present then the likes of the
Kenyan 'Matuta' Mini-Bus, Haitian 'Tap Tap' Bus, Columbian 'Chiva'
Bus and 'Chicken Bus' in Guatamala/Nicaragua/Honduras ply their
trades.
Whilst of course the owners of the
Indo-Asian 'Jingle Truck', though recognising the slow but increasing
appearance of larger modern single identity fleets, also for the most
part have the road to themselves. In stark contrast to Japan's money
lavished and exuberantly decorated 'Dekotora Trucks', similar
statements of owner independence, the Jingle Truck is the necessary
product of practical, low cost decoration, adaption and innovation;
applied to overall appearance, the challenges of what should be
routine maintenance and repair, and the need to maximise the utility
of the vehicle.
But perhaps the most singularly
renowned and expressive vehicle that evolves the pragmatic present,
and has shown the 'reconstructive spirit' of a country is the
legendary Jeepney of The Philippines.
The story of the Jeepney's emergence
and its success obviously begins with its roots in WW2 American
surplus military equipment left on the Islands. During a period when
motorized transport was precious, small-time entrepreneurs recognised
the Jeep's innate value. Once acquired those early operators
initially lengthening the rear overhang of a Jeep to accept more
cargo and passengers.
It soon became obvious that improved
economies of scale would be captured by lengthening the Jeep's
wheelbase to double or more its passenger capacity; with the addition
of roof-racks allowing for passenger goods storage above, instead of
occupying the cabin space, and even external bars onto which external
passengers could cling.
The genre evolved thanks to various
entrepreneurs, most visible being Leonardo Salvador Sarao Senior, who
on small borrowed funds founded Sarao Motors, a vertically integrated
firm which effectively set the engineering and bodystyle standard, so
becoming 'Mr Jeepney'.
To quote Wikipedia.....
“He
revolutionized a burgeoning industry and changed the life of
generations of Filipinos...he was awarded The Outstanding Filipino
Award in 1997 for Entrepreneurship Though he only attained low-level
of education because of poverty he was able to make the company grow
into a multimillion peso conglomerate”.
The vehicle type itself has
periodically yet continually evolved, today there being various
classes of Jeepney, from the truly original pure 'classic' from
original Willys Jeep parts, to the 2nd
generation type that uses reconditioned components, to a third
generation which are not Jeep derived at all, instead a modified LCV
truck chassis with standard or adapted wheelbase and Jeepney-like
bodywork that allows for even greater passenger numbers.
Whilst original Jeepney
manufacturer saw increasing competition, it was the 3rd
generation type that evolved the business model, able to create a
more expensive yet better income-earning vehicle.
So the Jeepney industry story is
one of genetic evolution as overtaken firms went into liquidation
resulting from both previous economic cycles and newer “son of
Jeepney” products. This evolution continues across the Philippino
archipelao as newer vehicles are either imported from elsewhere and
simply decorated as Jeepneys or indeed new-era Jeepneys are created
from the major adaption of other vehicle types ((pick-ups and vans)
or created from the drawing board using proprietary vehicle frames
and OEM components (engine, drivetrain, electrical, ancilleries),
which themselves are aesthtically ever more remote from the Jeepney
face.
Thus the effect of the Jeepney phenomina
has been to not only create the original industrial sector thanks to
Sarao and others, but in doing so creating a pilar of the Philippino
economy that both lubricated the economy through the transportation
of people and their goods, but also created a myriad of suppliers to
service this 'auto-economy', that economy itself grown ever large by
the introduction of new entrepreneurs and participants adding ever
more technically and utility improved vehicles.
The lesson here is that a country that
for so long was seen to be an economic backwater by the advanced
nations, did indeed create for itself by utilising those resources
immediately at hand, the surplus Jeeps, the pragmatic vision of
hands-on entrepreneurs and the cultural importance of a poor but
industrious and enthusiastic people.
Today the Jeepney industry is
horizontally diverse and vertically deep, encompassing body-side
painters, sheet-metal workers, materials suppliers, body-building
technicians (in steel, aluminium and plastics), general mechanics for
engines, drivetrain and chassis, component suppliers, vehicle
importers, and ever more diverse transportational services, from the
standard bus to tourist trails to celebrationary party buses.
As with any low-income nation the
Philippines seeks economic and social advancement, which invariably
includes greater official control of transportation modes and so
increasing altenatives to the Jeepney, including standard busies,
taxis and new tram projects.
But whilst seen to be in decline, the
vehicle has been re-invented and for over 50 years the visionary and
tenacious Jeepney manufacturers, despite facing competitve, technical
and political hurdles, have been an integral contributor to the
Philippino economy.
Conclusion -
This three-pat weblog has sought to
highlight how Europe's own economic transition, itself reliant upon
major structural reforms throughout the periphery nations, thereby
increasing their global competitiveness, should also be a
transformation that looks beyond its own backyard.
A philosophical shift that partly
re-invents its regional self.
So a need to maintaining its established
and leading stance in 'future-forward' activities, spanning much from
nuclear fusion research to expanded human rights regulation; yet also
able to recapture the best of its historical past, in doing so
simultaneously able to assist the requirements of today's 'bottom
tier' nations.
In effect re-creating the most
advantageous aspects of the historical European rise through the
world; in philosophical terms fusing the broad ideological
aspirations of Jean-Jacques Rousseau, Immanuel Kant and Rabindranath
Tagore, whilst also recognising their 'real-world' limitations.
The hypothesis of Europe following 'Core
Path' and 'Periphery Path' routes, which marries the modern and
historical capabilities of member states to different portions of a
globally inetgrated European Agenda, is an overt simplification. It
does not seek to untangle the complicated web of industrial,
academic, social and political activity that has formed over the last
60 years; and does not seek to create a divided 'high-value' vs
'low-value' Europe - which seems an unintended but possible outcome
of today's economic ruptures.
Instead, to simply portray a picture by
which Europe – via its PLC, AG, SA, SpA and now SE companies – is
able to recharge its economic self and plug into the presently small
but quickly growing relative wealth trickle of 'frontier countries'.
As European corporates sit on large
cash-piles and can access to record low borrowing rates,
simultaneously viewng a more muted inward-facing China and an
invariably globally re-expanding US, today appears the time to where
possible merge the interests of olde worlde Europe and the
entrepreneurial potential of today's underling countries.
As the small but indicative
stock-markets of such places as the ASEAN 'Hi-Five' continue to
simmer and eventually bubble-over, tomorrow's new era value-creation
will be borne from those 'ghetto entrepreneurs' who can read the
future.
Post Script -
A decade ago, having previously authored
the book 'Investment Biker', the renowned Jim Rogers apparently spent
3 years upon the 'road less travelled', driving across the world in a
radically converted Mercedes SLK upon a G-Wagon chassis towing a
small trailer (along with support truck) so as to taste emerging
nations first hand. (5-star hotels no doubt abound during the trek).
Today, Europe's corporate leaders need
not call upon Daimler's Dr Zetsche for a similar contraption, nor are
in a position to take 3 years out. But should swap either their
expensive seat at DAVOS or their pricey vacation VIP beach chair –
perhaps both – for the over-crowded seats of a rickety
multi-coloured old vehicle, somewhere along the 'peripheral path'.
