Last updated February 6th, 2019.
People sometimes ask why I started a business solely dedicated to investing in Asia. Why is it better to invest in Asia than elsewhere? Why shouldn’t there be an “InvestEuropean” if there’s an “InvestAsian”?
I packed my bags and moved to Asia practically the day after I graduated high school. That’s because I saw most of the world’s growth coming from this region.
Economic growth in Asia has averaged higher than any other continent for the past 30 years. You won’t find anywhere else with a population as dense and rapidly growing as Asia’s.
Below are just a few of the reasons why you’re now reading “InvestAsian”. Not “InvestAfrican” or “InvestSouthAmerican”.
Investing in Asia = Investing in the World
Firstly, I should define “Asia”. I’m talking about a broad definition – not only East and Southeast Asia. The whole continent includes India, the Middle East, most of the former Soviet Union and Turkey among other places.
Asia is Earth’s most populous region by far with over 4.4 billion inhabitants. A greater number of people live in Asia than outside, in fact. The world’s population is less than 8 billion.
In other words, Asia consists of a majority of the planet as humans know it. Through investing in Asia, you’re investing in the bulk of humanity.
“That’s fine, but how does having tons of people help Asia’s economic growth?” you may ask. At first glance, having a bigger population isn’t necessarily positive for investment.
Yet it truly does help a lot. Nations like China, India, and Indonesia boast massive populations. Countries like Thailand, Vietnam, and the Philippines aren’t slouches either.
Having a sizable consumer market means international firms seek expansion into them first. Why spend time selling to 5 million consumers in Costa Rica when you can access 240 million Indonesians instead?
There are more people living inside this circle than outside of it.
Foreign businesses have greater interest in Asia because of its larger size and influence which leads to higher growth. Investment from other parts of the globe have especially jump-started manufacturing and consumer-focused companies in China and Southeast Asia.
In turn, smaller Asian economies benefit from their bigger neighbors’ investment. Places such as Cambodia or Mongolia might be ignored if it weren’t for the behemoths nearby which are now doing plenty of their own offshore expansion.
Tourists and investment from China and India have helped their frontier market neighbors by generating a demand for industries and services that otherwise wouldn’t exist.
Simply put, a cycle of wealth generation is occurring throughout Asia as an entirely new middle class begins forming. The region’s size and population density are major drivers of growth and add to its momentum.
You Can Find Any Type of Investment in Asia
You have a wider range of investment options in Asia as well. The region’s economies enjoy a certain kind of diversity which can’t be found elsewhere.
For example, you cannot access some types of markets if you’re investing in South America or Africa. There aren’t any developed nations on these continents that are comparable to places like Japan, Hong Kong, or Singapore.
Africa has loads of frontier markets, a few emerging markets, but no fully developed countries. Developed economies are very important since they help feed investment, infrastructure, and employment opportunities into their neighbors.
Similarly, you’ll find almost no frontier markets in Europe or North America.
Asia is the only continent where you can find all types of markets. Their strengths complement each other as developed financial hubs sit alongside populous, high-growth economies. Take a look at Singapore and Malaysia’s relationship. Or Hong Kong and mainland China’s.
Likewise, Asia’s infrastructure that permits investment is better when compared to elsewhere. Property funds, private placements, mutual funds, crowdfunding, and other assets are harder to find in South America, for example, when compared to Asia.
To summarize, it’s not just easier to invest in Asia. There are also far greater options, superior opportunities, and more catalysts for stronger growth.
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