2021 Themes

2020 brought Covid, mega-tech as the new investment safe-haven, a contested US election, and successful vaccine trials. We assess investment opportunities and risks in 2021 by focusing on trends that will impact markets and investors. Low rates forev...

Restoring fiscal sustainability is set to become a key challenge as policymakers grapple with record-high public debt. As the pandemic eases, investor attention will focus on those countries with stronger, more credible adjustment paths. Fiscal conso...

Markets are now pricing in expectations of ‘low for long’ interest rates for the foreseeable future. EM fixed income assets are likely to be a major beneficiary of the consequent search for yield. Despite rate cuts in EMs, there are still a number of...

Public debt is expected to keep rising in emerging markets, albeit with great variation between countries. Credit spreads will diverge as some countries stabilise debt burdens post-Covid while others inch closer to default. Opportunities will emerge...

Threats to central bank independence have been brewing for years but may gain more traction after the pandemic. Emerging markets are generally less able to withstand such pressure than developed markets. For threatened countries, it could hit capital...

Globalisation doubled in the 30 years to 2007, but has since stagnated as leading economies pursue narrower agendas. Brexit and heightened China-US tensions are notable examples of this; the recent Abraham Accords are a welcome exception. EMs that co...

2021 will be the year when we find out the real shape of central bank digital currencies. If they offer a genuine token of value, central bank digital currencies could displace cryptocurrency and dominate EM. A desire to unseat the US dollar, and avo...

West Africa’s single currency plan has hit a roadblock, due to economic and political complications. A single currency might seem a long shot, but the route to that goal brings its own benefits. AfCFTA will shift the region’s attention towards buildi...

For years, mega Technology companies have grown faster and with higher returns on capital (particularly, in US$ terms), enjoyed wider equity valuation multiple expansion, and attracted greater fund inflows (the amplifying effect of passively managed...

Our survey shows consumer spending patterns have shifted towards digital payments since the start of the pandemic. Russia, Morocco, Indonesia, Lebanon and Pakistan appear well placed to shift away from cash in the coming years. Digital payments platf...

Many who can access the internet do not – a huge opportunity for innovators in the telco and tech sectors. Telcos have an information advantage, tech firms have an innovation advantage. We think partnerships between the two will yield the most profit...

Covid-19 hit poorer nations hardest, and the consequences of climate change could be similar. In a post-Covid world, the old barriers to energy provision and investment may be overcome. A clean energy revolution could be driven by tech and telcos, ra...

Benign geopolitical relations with and relatively unfettered trade access to (and investment flows from) the US. Whether these factors go in or out of fashion, a distinct factor may derail the efforts of the next wave of emerging and frontier markets...

The pandemic brought forward revenue for tech firms that can never be replicated. Prospects of a vaccine could bring a return to fashion for value stocks. If the illusion of non-financial metrics is shattered, the e-commerce bubble could burst.