Emerging markets are reshaping the global economy, and a convergence of powerful, long-term trends is accelerating this shift. These include surging demand for commodities, exploding middle-class spending power and booming inter-regional trade.
Investment specialist Andrew Keiller reveals some of the standout growth companies positioned to capitalise on this transformation and why now might be the perfect time to take advantage.
Background:
Andrew Keiller is a partner in Baillie Gifford and an investment specialist in our Emerging Markets Clients Team.
In this episode, he discusses how some of the fastest-growing developing economies are driving change in the world and the forces that could further hasten that trend.
The discussion builds on his recent paper, Emerging markets in 2050: growth in a changing world, which identifies long-term structural shifts tilting the odds in favour of standout companies in Asia, Latin America and eastern Europe. In the podcast, he expands on this by identifying some of the companies that could be big winners, including:
- the lithium miner SQM (Sociedad Química y Minera de Chile), which is set to benefit from a mismatch in supply and demand for the critical ingredient to electric car batteries and other energy storage systems
- the South Korean high bandwidth memory chipmaker, SK Hynix, whose products are critical to training artificial intelligence systems at speed
- the ‘super-app’ operator Kaspi.kz, which provides everything from bill payments, banking and travel bookings to shopping, maps and messaging
- the Singaporean ecommerce, fintech and gaming conglomerate Sea, whose chief executive has ambitions to extend into further sectors
- China’s biggest coffee chain, Luckin Coffee, which is giving the country’s 1.4 billion citizens a passion for the beverage with its ever-changing menu of inventive recipes
In addition, Keiller discusses the implications of President Trump’s tariffs and why many Chinese companies still offer an exciting investment opportunity.
Resources:
Emerging markets in 2050: growth in a changing world
Emerging markets: our philosophy
Emerging markets: rethinking the opportunity
Finding high-calibre growth companies in emerging markets (podcast)
Luckin Coffee: looking forward
Kaspi's super-app
South-east Asia’s rising export stars (podcast)
SQM: powering the future
The Time-Travelling Economist by Charlie Robertson
Companies mentioned include:
Kaspi.kz
Luckin Coffee
Sea
SK Hynix
SQM
Timecodes:
00:00 Introduction
01:35 Baillie Gifford beginnings and a trip to Hong Kong
03:15 Transformational trends playing out to 2050 and beyond
05:05 US exceptionalism and multiple spheres of influence
07:25 Rising trade between emerging market nations
08:35 Redesigning Chinese e-scooters for Vietnam and the Philippines
10:15 The possibility of reduced reliance on the US dollar
11:40 Increasing demand for raw materials and semiconductors
12:35 Digital-first companies and underserved communities
14:45 Four types of firms capitalising on long-term growth factors
16:25 SQM’s lithium mines in Chile’s Atacama Desert
17:55 Lithium’s long-term commodity cycle opportunity
18:45 SK Hynix’s high bandwith memory and its role in AI
20:40 Kaspi.kz’s Kazakh super-app
21:40 Kaspi’s expansion plans in Uzbekistan and beyond
23:00 Sea’s founder Forrest Li and importance of culture
24:30 Luckin Coffee’s huge domestic opportunity
25:25 Luckin’s taste for invention
26:40 Investing in China amid a trade clash
28:50 The risk of underexposure
29:40 Book choice
30:55 Investing in Africa
