Kevin T. Carter, EMQQ Founder & CIO, EMQQ The Emerging Markets Internet & Ecommerce ETF discusses state of emerging markets following China’s tech sector sell-off, and where future growth opportunities exist.
EMQQ, launched the same year as Alibaba’s IPO in 2014, provides investors with diversified exposure to companies operating in emerging and frontier markets. Capitalizing on the rapidly increasing consumption in countries like China, India and Brazil, the ETF zeroes in on internet and ecommerce sectors in the developing world. Top holdings include Alibaba (BABA) and Tencent (TCEHY) and Pinduodou (PDD).
With the internet becoming increasingly affordable and accessible, billions of people in the developing world are now leapfrogging traditional consumption patterns and starting to consume online for the first time. This trend, combined with the global pandemic forcing more digitized lifestyles, has resulted in an inflection point that’s accelerated ecommerce use globally.
The emergence of an enormous middle class consumer base, increased access to computers and the internet are keys to the growth story in emerging markets. “While I have had access to a computer for over 30 years, there are still billions of people across the developing world that have never had access to a computer,” says Carter.
Going forward, Carter believes that Gen-Zs will drive a whole new wave of growth and innovation in emerging markets. Last year, Ant’s record breaking IPO was halted. In 2021, the Chinese government has continued to crack down with increased regulations on the Chinese tech sector, triggering Alibaba to hit all-time lows in August and a major market sell-off. Carter says the recent sell-off has created new opportunities for investors. Carter also points to the ‘Next Frontier’ as the large pipeline of EM Internet IPOs to come in India, Southeast Asia, and South America.
To learn more on this topic, register from EMQQ’s webcast: Capturing the Growth in Emerging Markets.
Kevin will delve into the greater influence of this new consumer wave and the fundamental changes taking place in developing economies, their preference for online shopping via the smartphone and how Gen-Z will drive the next leg of this growing digital revolution. Kevin will also discuss the recent regulatory actions/crackdown in China, most recent earnings of China’s internet giants, current valuations and opportunities created by China’s tech sell-off. What’s Covered:
- What McKinsey & Co. calls “the biggest growth opportunity in the history of capitalism”
- How the largest Emerging Market ETFs are fundamentally flawed
- China tech under attack – what lies ahead for the sector
- Where current valuations stand and where opportunities exist
- The Next Frontier – the large pipeline of EM Internet IPOs to come in India, Southeast Asia, and South America
- How to capitalize on the next billion connected consumers in the rest of the developing world