Try Iraq for a True Frontier Market

By John Lee.

Writing in the Financial Times, a partner at a London-based financial advisory business suggests Iraq as a true frontier market investment.

Citing precedents such as Japan in the early 1960s and Russia in 1995, Richard Greer, a partner at Laurel Capital Kingsway LLP, says:

The greatest opportunities for emerging market investors have always come when political chaos coincides with a dire media consensus, and a major underlying economic improvement is thereby ignored. Iraq stands firmly in this tradition of missed investor opportunities.

He says that despite the political tensions, many listed Iraqi companies achieved record profits in 2012, there is the beginnings of some sense of civil order, the accumulation and investment of corporate cash, and a widening economic growth.

While energy companies such as Genel Energy, Sterling Energy, and Gulf Keystone Petroleum (GKP) have been investors favourites, Greer says the domestic companies on the Iraq Stock Exchange (ISX) are still waiting to be discovered by international investors.

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