The COVID-19 has caused the stocks of emerging markets to experience a difficult time. But, it is not the case with all the countries across the world. Some of the emerging markets sourcing companies are running their operations smoothly irrespective of the fragile condition caused by the pandemic situation. These countries have the exact structural changes and the right qualities required to thrive in this delicate situation. The structural changes that they have planned to deal with this situation have benefitted them and will continue to do so even after the local conditions improve. Except for a few, the majority of the countries are struggling with the investment goals in emerging markets.
Another vital fact to be looked upon is the step acquired by the investors- their flight to safety assets to deal with the crucial situation. The US dollar is also heard to have experienced great loss in the stocks of emerging markets after the decision taken by the investors during the lockdown. It was only after the month of June that the grounds were regained and the index of the MSCI Emerging Markets was down just by a percentage of three, which continued to be the same through July. In terms of the US dollar, this decline is quite like the performance showed by developing countries, and it is not that much a thing to worry about.
Several countries from Poland to Taiwan have excelled in controlling the spread of the pandemic. They have utilized their power, minds, and resources to excel in preventing the number of deaths in a way that even developed countries could not. The fight among the country people to defeat the virus’ power has prompted changes in the behavior of the consumers and the corporate as well. This has caused the opportunities of the EM markets to wide open their pockets that will enable them to endure the pandemic situation now and later.
The ResponsesToward Virus Is Changing By Emerging Market Countries
It is believed that nine out of ten countries are in the emerging markets that have new and increasing cases of coronavirus. And, out of all these countries that are enlisted in the emerging markets list, the United States is the only developed one. Some of the countries like Indonesia, the Philippines, and India are still in the struggling phase to get a hold on the spread of COVID-19. These are some of the low-cost country sourcing that lies in South Asia dealing with problems on how to stand out again. Some of the countries in Latin America are also receiving new reports of COVID-19 infected cases.
The most-effective EM countries at containment is South Korea, China, and Taiwan. These countries narrate for a benchmark of more than sixty percent. These countries and some others like Thailand and Malaysia have succeeded in fighting against the COVID-19 cases and reduce it remarkably to a ten percent mark of their respective summits.
With such a great step towards success, that is their ability to fight back so strongly, will make sure they get back to their normal road very soon. They will also be able to resume its growth in the economy before the United States can. Investors can find EM n these EM winning fertile grounds (countries) on the basis of risk analysis on companies.
One Can Expect A Fast-Paced Change Due To The Pandemic
The pandemic could not fully put the merging market’s emergence on stake. The people across the globe have somehow learned to get accustomed to this new normal. The organizations have accepted the work-from-home habit are have considered it as the new normal as well. With more than one billion people following their daily work schedule of office work, education, and entertainment from home, the emerging markets have found out new ways creating investment strategies. The pandemic has rather caused the EM countries to increase their usage of technologies which have affected these countries in a positive way.
Shifting the light to online games- this has seen a rapid increase in usage due to lockdown. With people staying at home, spending the maximum part of their schedule sitting idle, the pandemic has caused them to invest their time in playing mobile games. The pandemic has shaped the ways how casual gamers spend their time playing online games almost throughout the day. The investors of low-cost country sourcing are investing in the game publishing organizations are also benefitting from the tailwind of rapidly increasing game-user base.
Another way pandemic is helping EM countries is with the rise in the trends of online shopping. In this e-commerce has itself been a force for a change in the emerging markets. People everywhere is immersed into the online shopping applications, placing order for their requirement. This rapid explosion in the online shopping idea has alone caused China’s grocery sales to have jumped more than a hundred percent since the onset of the virus’s effect.
Other Than Technology, Several Sectors Are Lasting Potential
The pandemic has specifically led to a change in the consumer’s habits other than changing tech usage. This change in customer’s behavior will continue to remain the same long after the COVID-19’s pandemic effect subsides. The two important areas experiencing drastic growth is products of personal hygiene and cleaning services. The EM-based producers of PPE (personal protective equipment) are experiencing rapid growth in the profit margin. Similarly, the companies who take up cleaning works of removing medical waste from hospitals are in increasing demand as well.
While every emerging country is having their own stories of experiences, most of the emerging market nations are on the verge of their recovery mode. As you can see countries turning their corners and getting adapted to the new normal brought by the virus, opportunities in growth will become more visible. No matter how difficult the situation becomes, or it is, it is always better to select the emerging markets sourcing companies that take advantage from the secular trends as they have the potential to deliver better results to patient investors.