Emerging markets 'leapfrogging' normal development

Investing in developing economies when they are quickly catching up with – and in some cases, surpassing – the rest of the world

Andrew Willis 2 May, 2019 | 2:00PM

Note: This article is part of Morningstar Canada's Emerging Markets Week Special Report

Imagine taking a group of developing economies with billions of workers, consumers, and significant assets held back by inefficient infrastructure and lines of communication, and then swiftly injecting a dose of the latest digital efficiencies and cutting-edge innovations across multiple sectors.

That’s happening right now in emerging markets, as significant structural changes skip slow and expensive routes to sector development, boosting economic growth – and gains. It’s known as the ‘leapfrog effect’, and it has wide-ranging investment implications for both company fundamentals and macroeconomic considerations.

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Andrew Willis

Andrew Willis  is Content Editor for Morningstar.ca

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