Monday 06, March 2017 by William Mullally

Emerging and frontier market investors gather for the largest investor conference in the MENA region

Bold reform agendas are driving interest in sustainable growth opportunities in emerging and frontier markets; gathering comes as EFG Hermes launches execution capability in frontier Asia, looks to open one or more offices in sub-Saharan Africa.

 EFG Hermes, a financial services corporation in the Middle East and North Africa, has launched the 13th annual One on One Conference, the largest in the event’s history. The event, considered the largest investor conference in the Middle East and North Africa, takes place under the patronage of His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai.

The conference takes place on a changed global economic backdrop, as competition for global capital is tightening, developing economies have become a staple for investors looking to both diversify their portfolios and potentially benefit from faster growth. However, emerging market equities are in the spotlight again after a strong 2016 that saw the MSCI Emerging Market Index return more than 11 per cent, its best annual performance since 2012 – and three years of negative returns. Furthermore, total assets under management allocated to frontier markets have more than doubled over the past six years.

More than 510 international fund managers and institutional investors from 260 institutions with aggregate assets under management in excess of USD 10 trillion are scheduled to attend the three-day gathering starting this morning, where they will hold face-to-face meetings with more than 147 companies listed on Middle Eastern, African and Southeast Asian stock exchanges.

“New opportunities in emerging and frontier markets alike are being created by ambitious policy makers who are increasingly going beyond conventional reforms into areas that were once taboo,” said EFG Hermes Group Chief Executive Officer Karim Awad. “That notable transformation is at the heart of this year’s conference: Change in how policy is created, economies are structured and sustainable growth strategies that are compelling to global investors are designed.

“Evidence of that change spans across our firm’s footprint. Egypt has embarked on an ambitious reform programme that includes a full float of the national currency and an aggressive programme to fundamentally restructure its economy and revitalise its capital markets. The United Arab Emirates continues to stay ahead of the curve, with a phase-out of subsidies in progress, a value-added tax in the pipeline, and new merger and acquisition activity. Saudi Arabia’s ambitious reform drive includes the privatisation of Saudi Aramco, the crown jewel of its economy. And Pakistan has passed through a rigorous reform programme as a condition of its IMF assistance, the upshot of which will be its elevation this spring to MSCI Emerging Market status,” Awad noted.

The opening session will boast a very strong lineup of keynote speakers including Emaar Properties Chairman HE Mohamed Alabbar and Egyptian Minister of Investment and International Cooperation HE Sahar Nasr, who will both address this drive for change when they speak before a plenary session of investors and presenting companies this morning.

The Annual One on One Conference places companies from more than a dozen frontier and emerging market countries in the spotlight for top global institutional investors from Europe, the United States, the Gulf Cooperation Council and beyond.

Half of the almost two dozen participating non-GCC frontier market companies at the One on One are from Pakistan, which will be upgraded to MSCI Emerging Market status in May. Pakistani companies attending this week are expected to account for c.44 per cent of the MSCI Pakistan Index when it launches.

“For the first time, frontier companies are front and centre at the One on One as we complete our transformation from the leading investment bank in the MENA region into a full frontier house,” said Mohamed Ebeid, co-chief executive officer of the investment bank platform at EFG Hermes. “As we speak, we are concluding our acquisition of a brokerage house in Pakistan and have launched execution capabilities for frontier Asia, offering our clients access to Pakistan, Vietnam, Bangladesh and Sri Lanka. That execution capability is backed by a dedicated team and will be served by our existing offices in Cairo and Dubai as well as our soon-to-open New York office.”

Ebeid added, “As we continue to build out our Asia-focused operations with both new products and a new research platform, we are also very mindful of the exceptional opportunities to create new shareholder value through a direct presence in one or more market in sub-Saharan Africa.”

Attendees will also vote live in the EFG Hermes Consensus, the largest poll of investor sentiment toward emerging and frontier markets.

 

 

Features & Analyses