The new emerging market theme has moved from BRIC to BIIC. Drop Russia and add Indonesia. The economy is large, dynamic, growing, and young. Russia is large, static, resource focused, and old. The business environment in Russia has been negative and its behavior is more akin to a a classic emerging market dependent on natural resources for its growth. Indonesia also has natural resources but has a change to be a dynamic regional power-house.
Indonesia is about 40% of the size of Russia but the current growth rate is over double. It is the momentum in growth that provides the best upside for businesses. Its finances are in good shape and the cost of dong business is low.
Russia is driven by its natural gas and oil production. It is viewed as a difficult place for doing business and the population is declining as well as aging. There will have to be a significant change in government before dynamic growth occurs.
Indonesia is about 40% of the size of Russia but the current growth rate is over double. It is the momentum in growth that provides the best upside for businesses. Its finances are in good shape and the cost of dong business is low.
Russia is driven by its natural gas and oil production. It is viewed as a difficult place for doing business and the population is declining as well as aging. There will have to be a significant change in government before dynamic growth occurs.
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