Franklin Templeton's Mark Mobius is bullish on Latin American countries, claiming the region offers growth opportunities, particularly in the commodities and banking sectors.
The emerging markets guru says while commodity stocks have been hit by a fall in prices, many companies are still profitable at current price levels.
Mobius says: "We do not foresee prices returning to extremely low levels in the near future. We believe commodity companies should remain profitable and constitute attractive investment opportunities."
He points out Latin America is the world's largest and lowest cost producer of many commodities: Chile and Peru are among the world's leading copper producers; Mexico is a net exporter of oil; Brazil is a major exporter of iron ore and soft commodities and Colombia exports oil, coffee and coal.
Mobius, portfolio manager of the £1bn Templeton Emerging Markets Investment Trust (TEMIT), believes banks in the LatAm region should also be able to weather the current weakness in the global economy.
"Latin American banks have minimal exposure to the toxic assets that have plagued financial institutions elsewhere," he says.
"Bank loan penetration in the region is still very low; this not only reduces the risk of bad debt but it is also a barometer of how under-penetrated the countries are in terms of goods and services. They are in a strong position to benefit from a recovery in the global markets," he adds.
TEMIT, the largest emerging markets investment trust in the UK, has a 21.6% weighting to Brazil, its largest country exposure.Investment Week
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