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Tiger Cub Economies Part 1: Demographics And The Middle Income Trap

This is the first installment of a 4-part series examining the 5 Tiger Cub Economies, and the fundamental factors used to determine the best country ETF to invest in. The first article provides an overview and covers country demographics and the "middle income trap".


Tiger Cub Economies

The term "Tiger Cub Economies" refers to the economies of Indonesia, Malaysia, the Philippines, Thailand and Vietnam. Many economists believe that these developing economies are young versions of the Four Asian Tigers: Hong Kong, Singapore, South Korea, and Taiwan. The Asian tiger economies exceeded 7% growth per year during the latter part of the 20 th century, and successfully transformed into highly advanced, high-income economies. The Tiger Cub Economies are low-to-middle-income with an abundant work force, high rates of investment, and rapid economic growth, similar to early versions of the Four Asian Tigers. But making the transition to a high-income economy will be difficult for these cubs. According to World Bank estimates, only 13 of 101 middle-income economies have made the transition since 1968.

Country ETFs

The country ETFs listed below are the highest liquidity funds that correspond to the countries involved in the Tiger Cub Economies. The ETFs will be examined in part four of this series.

iShares MSCI Indonesia ETF (NYSEARCA:EIDO)
iShares MSCI Malaysia ETF (NYSEARCA:EWM)
iShares MSCI Philippines ETF (NYSEARCA:EPHE)
iShares MSCI Thailand Capped ETF (NYSEARCA:THD) VanEck Vectors Vietnam ETF (NYSEARCA:VNM)

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by Steve Auger