GLOBAL INVESTING: A Survey of the Investment Environment of Thirty-Six Countries

Howard E. Woodward Jr.
July 1997

INTRODUCTION

The investment environments for selected countries are evaluated. The countries evaluated are selected from those countries that have stock exchanges and in which investments can be readily made by U.S. citizens through mutual funds, World Equity Benchmark Shares (WEBS), foreign stocks listed on U.S. exchanges, or through the availability of American Depository Receipts (ADRs). Major global trends are identified. The factors that contribute to or detract from a country’s investment attractiveness are identified. Relevant data regarding these factors are collected and analyzed. A subjective scoring and weighting system is used to develop a numerical score for each country’s attractiveness. Conclusions regarding each country are presented.

This paper was written as an independent study project in the field of management of international operations in 1997. It was written in fulfillment of a Master of Business Administration degree at Indiana University in Fort Wayne, Indiana under the guidance of faculty advisor, Dr. David Turnipseed. The objective of the paper was to utilize the principles taught in MBA level International Business courses to evaluate the equity investment environment of various countries.

(Post Script: September 2000 - Obviously, given that the paper was written in 1997, time and events have rendered some of the data obsolete. The 1998 global liquidity crisis and political events in Russia are examples of events that were unanticipated.  In some cases the results since these events have demonstrated the validity of the underlying analysis.  In other cases they highlight the weaknesses.  I publish this paper as it was written because I believe that the analysis methodology is interesting and that the resulting conclusions are, for the most part, basically sound.  I have taken advantage of hyperlinks to link to some current data.  Other than that, the paper is as originally published.

For anyone with a strong enough interest to wade through this paper, I strongly recommend reading William Greider's One World, Ready or Not; 1997; Simon & Schuster.  Greider discusses some very interesting macro-trends in the global market place and discusses how aggressive political action and aggressive negotiating can overcome the weaknesses of the disadvantaged nations.)

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