Asia attractive as global growth slows - Fidelity

Investors could find Asia an attractive proposition in relative terms as growth becomes harder to find across the globe, according to Fidelity International head of investment services Maria Abbonizio.

“There is very attractive growth in Asia, there is more value in the market than we have seen for some time and sub-prime is also not an Asian problem,” she explains.

She also believes the dominant economy of the region, China, is set to remain robust despite the concerns of some investors.

“If the US does go into recession it would be naïve to think China wouldn’t be affected. But the Government’s balance sheet is very strong and they are able to add to domestic demand which is higher than it has been.”

The impact on China of hosting the Olympics will be centred on improved infrastructure around Beijing. However, she believes the event could also help foreign investors understand the country.

“It will help if people visit China and see the pace of change. There is huge wealth creation there and people are driven to improve.”

Other than China she highlights Indonesia as one of the more interesting smaller countries in the region. The government is starting to weed out corruption and there are lots of soft commodities which are starting to attract foreign investment.

She says the team is also positive on India in the long term despite recent market volatility.

“The recent correction have been quite positive as the market was a little on the expensive side and it has come down a lot which we are more comfortable with.”

Fidelity now has a big research team spread over five locations in Asia. Abbonizio says the asset manager plans to add incrementally to resources including the number of analysts in China and India.

The group also recently launched the Fidelity Asian Aggressive fund which allowed it to meet the demand for a more concentrated portfolio investing in the region and to adopt a wider investment remit including Australia.