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Islamic economies undervalued, promising: expert

Xinhua, April 1, 2015 Adjust font size:

The Islamic economies have the most promising growth potential among global emerging markets, an investment expert said on Wednesday.

Delivering a keynote speech at the Islamic Finance (IFN) Investor Forum, Mark Mobius, executive chairman at Templeton emerging markets group at Franklin Templeton Investments, said the Islamic economies are expected to grow by five percent in 2015, compared to a two percent growth of the developed countries.

"Among the emerging markets, the Islamic economies such the United Arab Emirates (UAE), Qatar or Turkey offer a good potential growth as shares listed at their markets are relatively cheap," said Mobius.

Dividend yields in the Islamic emerging markets are also higher than those in other emerging countries and the developed markets, added Mobius.

"As of February 2014, the average dividend yields in Islamic emerging markets was 2.9 percent compared to 2.8 percent in the global emerging markets and 2.3 percent in the developed markets. Some stock markets in the Islamic countries currently underperforming due to the oil prices slump were no obstacle, " the investor said.

Data show the Dubai financial market lost 4.52 percent in the first three months of this year, while the Abu Dhabi Securities Exchange (ADX) gained 1.87 percent in the same period.

Mobius said that due to the fast growing populations in the Islamic emerging world, the demands for infrastructure investments, education, healthcare and consumer goods, are expected to rise and outperform global average in the next five years.

With a growing number of 1.6 billion Muslims worldwide, the Islamic economies are poised to lead the next leap in the emerging markets, said Mobius. Endit