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BRICs Are So 2000: Care for a MINT?

NEW YORK (TheStreet) -- Jim O'Neill, then with Goldman Sachs (GS), famously called Brazil, Russia, India and China the BRICs in 2001, and those who followed him into those economies were richly rewarded.

Buying into developing economies is like buying technology stocks. You want to get in early, ride the adoption curve, and get out when the crowd moves in. The risks are high, and so are the rewards.

But the BRICs are so last decade.

Instead O'Neill, now an honorary professor at the University of Manchester and a Bloomberg columnist, has a new acronym for investors: MINT. It stands for Mexico, Indonesia, Nigeria and Turkey. These are the countries to watch for the next decade, he argues. All are young in an aging world, and they all have interesting economic prospects.

Not all of O'Neill's calls are consistent winners. O'Neill writes that Russia's growth is already slowing, while China's is continuing, and Brazil's GDP growth is now below that of the U.S. But if you bought a Brazil ETF such as the iShares MSCI Brazil Index  (EWZ) a decade ago, you have more than doubled your money.


The iShares ETF for Mexico is traded as (EWW), and that's the sound investors have been making about it for the last year, when it has fallen nearly 16%.

But Mexico has a median age of 26, a full decade younger than the U.S.'s, which is 37. That means there's great human capital potential in Mexico.

The World Bank estimates Mexico's GDP grew almost 3.9% in 2012. Mexico, not the U.S., is the home of the world's richest man, Carlos Slim. Growth slowed to just 1% in 2013 but is now expected to pick up, thanks in part to its role as a low-wage manufacturing hub for the U.S.

O'Neill has been quoted as saying Mexico's economy has "a perfect storm of benefits" but that doesn't mean things are great. Many workers remain in the underground, untaxed economy. The country is made dangerous by a drug war over exports of cocaine, heroin and other drugs to the U.S.

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EWZ $36.81 -0.97%
NGE $10.43 1.36%
EIDO $26.39 -3.79%
TUR $48.34 2.35%
EWW $60.18 -0.20%


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