China is on a path toward an ambitious reform agenda focusing on the quality of growth instead of relying on quantity, including environmental protection, continued cuts to excess capacity and reducing excessive credit growth. For China exposure, the iShares China Large-Cap ETF (NYSEArca: FXI) is the largest option available.
Brazil is undergoing massive reforms, including a 20-year constitutional spending cap tied to inflation, which has helped bring the economy out of a deep recession and strengthened investment confidence. The country now is working on passing pension reforms. Meanwhile, the Brazilian market is enjoying an acceleration in earnings growth. The iShares MSCI Brazil Capped ETF (NYSEArca: EWZ) provides exposure to some of the biggest companies in the Brazilian equities market.
Lastly, India and Indonesia both reveal improving domestic growth that is powered by reforms. In India, the bank recapitalization efforts could ease credit conditions and bolster the weak banking segment’s balance sheets. In Indonesia, subsidy cuts have lifted government revenues, which has contributed to a 120% annual increase in social payments to lower income households. The iShares India 50 ETF (NASDAQ: INDY) and iShares MSCI Indonesia ETF (NYSEArca:EIDO) provides targeted country exposure to India and Indonesia, respectively.
For more information on the international markets, visit our global ETFs category.