Beyond the BRICs: The Next Wave of Investable Economies

For years, “emerging markets” was shorthand for a handful of giants. That map is being redrawn. A new wave of economies — some graduating from frontier status, others reshaped by shifting global supply chains — is drawing serious investor attention, and the opportunity set is wider than it has been in a generation.

A widening universe

The clearest signal is Vietnam, set to be upgraded from frontier to secondary emerging-market status in a major index reclassification — a milestone expected to draw significant institutional inflows. It is not alone. Indonesia, India, and others are posting robust growth, while a broad rewiring of global manufacturing is transferring export momentum to new hubs, particularly Mexico, Vietnam, and Bangladesh, as companies diversify their supply chains.

Why now

Several structural forces are converging at once:

• Supply-chain diversification. Near-shoring and friend-shoring are moving factories and jobs toward a wider set of economies.
• Demographics. Young, growing, increasingly urban populations across South and Southeast Asia and Africa are expanding both labour forces and consumer markets.
• Reform and stability. Many emerging economies now carry stronger institutions, more fiscal discipline, and lower debt burdens than in past cycles.
• The AI cycle, absorbed. Economies that can adopt new technology efficiently stand to gain in productivity and long-run growth.

The mismatch at the heart of it all is striking: emerging markets represent roughly 40% of global output, yet only around a tenth of the world’s equity index — a gap that, over time, has room to close.

The access gap

Here lies the catch that has long frustrated investors. Many of the most compelling companies in these economies trade only on their local exchanges, historically difficult to reach for anyone without native market access. The opportunity has never been the problem; the barrier has been the plumbing. Removing that barrier — offering a regulated route into markets that were once effectively closed — is exactly the gap a global platform exists to fill.

A measured view

None of this comes without risk. Higher growth travels with higher volatility, thinner liquidity in smaller markets, currency swings, and governance questions that vary widely by country. The sensible response is not to avoid these markets but to hold them the way any asset class should be held — diversified, sized to your risk tolerance, and with a long horizon.