Opportunities in Frontier and Small Emerging Markets

This report outlines the performance and potential of frontier and small emerging markets in 2024, highlighting their unexpected gains amidst global uncertainties. The document identifies Argentina, Kenya, Pakistan, Sri Lanka, and Tanzania as the top-performing markets, driven by significant economic reforms and low valuations. It discusses how these markets are less correlated with global trade tensions and are poised for growth due to strong domestic demand. The report presents five key themes for 2025, including economic recovery through reforms, the impact of geopolitical tensions, demographic advantages, and the rise of local brands. It emphasizes that while developed markets face demographic declines, countries in frontier markets are expected to see an increase in their working-age population, which will support economic growth. The analysis suggests that these markets offer diversification opportunities for investors looking for growth outside traditional safe havens.