By Andrei Skvarsky.
Investors shouldn’t neglect financial centres in emerging markets, some of which, though little known, have excellent prospects, according to online real estate dealer Lamudi, which does business in 34 emerging- and frontier-market countries.
A statement from Lamudi suggests five “up-and-coming financial centres of tomorrow” for investors to think about.
Among them are Dubai with its reasonable tax laws, stable banking system and favourable business environment and Qatari capital Doha, both of which are renowned financial hubs. The former is 23rd and the latter 20th on an 82-city list of principal global financial centres released by London-headquartered commercial think tank Z/Yen in March 2015.
Both the United Arab Emirates and Qatar are trying to diversify their economies and move away from their dependence on oil and gas, and one aspect of this effort is boosting their financial sectors, according to Lamudi, which was set up in 2013 and has its headquarters in Berlin.
Mexico City (which is 56th on the Z/Yen list) is the seat of an international stock exchange, “attracts a growing number of foreign property investors, who benefit from Mexico’s proximity to the United States”, and is growing rapidly as “Mexico’s focus has shifted from agriculture to industry”, Lamudi says.
In 2014 there were 62 greenfield investment projects underway in the Mexican capital, which were valued at $2.24bn.
Makati, one of the 16 cities making up Metro Manila, the Philippines’ National Capital Region, hosts the main trading floor of the Philippine Stock Exchange and the headquarters of major Filipino banks and companies. Some foreign embassies are based in Makati as well. Manila is 62nd on Z/Yen’s list.
Chittagong is one of the main commercial, industrial and financial hubs of Bangladesh but “is developing into an international financial centre”, though it is not on the Z/Yen list, the dot-com property dealer says.
The firm points out the port city’s proximity to Myanmar and India and a proposal to build a trunk road from Chittagong to Kunming in Southwest China via the Bangladeshi town of Cox’s Bazar and Myanmar.
“The emerging markets are home to a number of growing hotspots for financial centres,” said Lamudi co-founder and managing director Paul Philipp Hermann. “Whilst there are challenges that must be taken into account, including immature markets and political challenges, when strategizing a move into an emerging market, vast opportunities are being created – as long as strongly researched decisions are made and realistic strategies are in place.”
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