Antoine van Agtmael says he coined the now-fashionable term “emerging markets” way back in 1981. He was then working for the International Finance Corporation, the private sector lending arm of the World Bank, and was pitching global investors to buy into a fund that would invest in poor countries. These countries were called the “Third World” in those times, which meant visions of “flimsy polyester, cheap toys, rampant corruption, Soviet-style tractors and flooded rice paddies,” says van Agtmael.
A Third World fund would be a hopeless bet on stagnation. So he decided to market the fund he was selling as an “emerging markets fund”—suggesting progress and dynamism. That was a clever piece of rebranding, but Agmatel’s links with Asia go beyond coining the now-popular phrase “emerging markets.” Having chosen to move to Bangkok rather than to Paris in the early 1970s, and being a cheerleader for this part of the world through the decades, van Agtmael’s credentials to do a book on companies of emerging markets are impeccable.
You can’t fault the timing of the book either. Many companies from the emerging markets have taken over counterparts in the West—Lenovo’s buyout of IBM’s personal computer division or Tata Steel’s more recent acquisition of Corus. It is quite clear that the emerging markets are no longer the economic backwaters that they once were.
This book looks at 25 of the best emerging market companies, largely from Asia and Latin America. There is only one African company in the list. Three companies from India feature in the book—Infosys, Reliance and Ranbaxy. The stories are told through interesting data, quotes and anecdotes. But they make no larger point. Take the 10 pages on Infosys.
There is a lot in Agtmael’s book that has already been written about—from how its campus is an oasis in Bangalore’s urban chaos, of Narayan Murthy’s capitalist mind and socialist heart and how Infosys has become the poster child of success in contemporary India.
The author tries to examine the reasons for the success of his 25 chosen companies. As with Infosys, a lot of the territory he takes us through has been well-charted. But while providing readable accounts of how these companies grew to the size they now are, van Agtmael fails in the broader task of explaining the common factors that have propelled these companies to their current heights. And that’s the fundamental flaw in the book.
It is never quite clear to the reader whether it is about companies that have excelled because they come from emerging markets or whether they are excellent companies that happen to come from emerging markets. There is little clarity on cause and effect.
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