With the current global risk off sentiment, we're seeing some pull-back from EM. However, some economies like Vietnam or India still show resilience. For those allocating across EM, where are you seeing the most defensible positions given the current macro backdrop? Specifically interested in the ASEAN region beyond the obvious.
Good question. Beyond the usual suspects, I've been eyeing the Philippines. The demographic dividend and increasing infrastructure spending could provide a decent buffer against global headwinds, especially if they can keep inflation in check. It's a longer-term play, but might offer some stability.
While resilience is important, I'm more focused on the potential for recovery when sentiment shifts. Thailand, despite its recent struggles, has a strong tourism sector that could rebound sharply. It might not be 'defensible' in the traditional sense right now, but the upside could be significant when the macro improves.
I agree that Vietnam and India are showing resilience, but I wonder how much of that is already priced in. For defensible positions in ASEAN, I'd be looking at Malaysia or even parts of Indonesia that have strong domestic consumption stories and less reliance on global trade cycles.