18/07/2011
By Matt Ritchie
Russia is set to become an increasingly attractive market to investors over the next 18 months, according to Baring Asset Management.
In a note published today, Barings said it expects to see solid GDP growth continue, despite Russia’s economic recovery having been slower to gain momentum than other emerging European nations.
Russia’s parliamentary elections will take place this year, and the presidential election is to be held in 2012. Manager of the Baring Russia Fund Matthias Siller said the political backdrop over the next 18 months will have a positive influence on investment opportunities in the country.
“The elections will naturally result in an increase in social spending on infrastructure and on housing as the government tries to secure support. Aggressive fiscal loosening will also put more money in people’s pockets and boost consumer confidence, supporting growth,” Siller said.
GDP growth is expected to remain solid, and Barings believes the Russian economy has been relatively resilient to the financial crisis.
Privatisation efforts are picked to increase and generate more growth for businesses, and wage growth and consumption are expected to be underpinned by a deficit spending increase in Russia.
Siller said that while food inflation will slow real wage increases for the time being, Barings expect a re-acceleration of real wage growth in the second half of 2011 as inflation levels off.
“This supports our positive outlook for Russian consumption over the rest of the year.
“Russia remains attractively valued against its emerging European peers and we believe that this, along with demonstrable economic resilience, a positive outlook for increased consumption and solid finances, means Russia will become an increasingly attractive investment option for investors.”
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Appointments Update
Michael Siciliano has been appointed as head of North American sales at Baring Asset Management. He has a wide range of experience in multi-asset strategy and international equity portfolios and joins Barings from Merganser Capital Management in Boston where he worked as director of sales
September appointments update
Northern Trust has appointed Annika Larsson and Erik Norland as senior relationship managers in its Stockholm office, in line with the company’s strategy of serving clients as close to their home market as possible.
News in Brief
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