Colombia Ranks Among Top Emerging CIVETS Markets: Countries with High Growth Potential
In the last decade Brazil, Russia, India and China – countries whose up-and-coming economies were collectively referred to as BRICs - were seen as the leading global emerging markets. Today, those nations’ economies are thriving, and countries, such as Colombia, are among the top new emerging markets to arrive on the block.
These latest upstart countries – which also include Indonesia, Vietnam, Egypt, Turkey and South Africa - are together called CIVETS, after a long, slender cat indigenous to parts of Asia and Africa. Their once-seemingly sleepy economies now resemble the nocturnal feline after which they were named – markets that are ready to pounce.
According to an April 27 Reuters article, Michael Geoghegan, the CEO of HSBC, Europe’s largest bank, says that among the CIVETS countries, “Each has a very bright future. Each has a large, young, growing population. Each has a diverse and dynamic economy. And each, in relative terms, is politically stable.”HSBC is looking to these countries for its growth, as power shifts away from global superpowers, such as Europe and the United States, since these emerging markets are growing three times faster than developed countries this year and are also leading the globe down the path out of a worldwide recession.
In the same Reuters piece, Geoghegan also says that emerging markets will overtake the developing world within three years, measured by purchasing power parity. He called this era “a defining moment.” As the ranks of middle class consumers in these emerging regions grow to more than three times their size in 2000, swelling from 250 million people to 1.2 billion people by 2030, more households are expected to open bank accounts.
Geoghegan says people tend to begin banking when their annual incomes reach about $10,000. They then begin to demand other financial products, and all of this clearly bodes well for the financial services sector. China is already experiencing a similar phenomenon with roughly 33 million households about to reach this financial threshold, and four times that number expected to reach it by 2014, with 155 million families looking to potentially start bank accounts. Geoghegan says a change in India will also be similarly dramatic.
