MANY of us are familiar with Malaysia’s major international affiliations, and can reel off a bunch of acronyms such as Asean, UN, Apec, OIC, NAM, ADB and G-15. But have you heard of MIMT?
Yes, there is such a thing and Malaysia is part of it. And it’s significant enough to be mentioned in the latest edition of Global Economic Prospects, a flagship report by the World Bank.
MIMT stands for Mexico, Indonesia, Malaysia and Turkey. It’s not a formal organisation whose only members are the four countries. That would be a puny and odd body. So what is it then?
It appears that the four have been grouped together because they’re among the biggest developing countries, and they have certain common characteristics.
However, the January 2016 Global Economic Prospects report doesn’t explain why the quartet belongs together. The sole reference to MIMT is the inclusion of the four nations’ data (along with that from five other economies) to show trends in credit growth and private sector debt level among the developing countries.
We have to turn to an earlier report to better understand why the bank feels these four countries fit under one banner.
Last month, the World Bank published a policy research note titled Slowdown in Emerging Markets: Rough Patch or Prolonged Weakness?. In it, the bank points out that Brazil, Russia, India, China and South Africa (more conveniently known as BRICS) account for about two-thirds of the combined gross domestic product of the large emerging market economies, while MIMT’s share is one-eight.
BRICS and MIMT are, in fact, the world’s top nine emerging markets. BRICS are the leading five and MIMT form the second tier.
So, it’s about economic labels, which can be catchy and powerful. The idea is to identify several countries with similar sizes and development dynamics. Come up with a nifty name for that group and start talking about their growth prospects. Soon, businesses and investors will be wondering if they’re missing out on the action.
Animal names are a good way to capture the imagination. Remember the Asian Tigers (Hong Kong, Singapore, South Korea and Taiwan) and the Tiger Cub Economies (Indonesia, Malaysia, the Philippines and Thailand)? More recently, there’s the Pacific Pumas, which is a cooler way to call the four members (Chile, Colombia, Mexico and Peru) of the Pacific Alliance, a platform for regional integration.
Then along came a Goldman Sachs paper in November 2001 that gave a glowing picture of the growth potential of Brazil, Russia, India and China (BRIC). The report argued that as these four countries expanded and had a bigger impact on the global economy, world policymaking forums needed to be re-organised.
And thus the BRIC acronym was introduced into economics terminology. The four countries took their cue and formed an association. They have been holding annual summits since 2009. In 2010, South Africa joined them and BRIC became BRICS.
So now the way to go is to cleverly connect initials of nations so as to help push economic and investment ideas and themes. At one time, the next big thing from the vast pool of emerging economies were CIVETS – Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa. Somebody else came up with VISTA – Vietnam, Indonesia, South Africa, Turkey and Argentina.
But one other acronym that has caught on well is MINT. That’s Mexico, Indonesia, Nigeria and Turkey. And yes, MIMT may have replaced MINT, at least in the eyes of the World Bank.
The appeal of MINT was first promoted by investment management outfit Fidelity International in May 2011. The firm’s press release had a great hook for a heading – “Are MINTs the investment opportunity of the next decade?”
“Finding the next group of countries that can compare with BRIC in terms of scale is a virtually impossible task but MINT may just have the potential to be as rewarding for investors over the next 10 years as BRIC have been in the past,” said Fidelity.
Jim O’Neill, the Goldman Sachs executive credited with coining BRIC, has also contributed to the efforts to draw more attention to MINT. He worked with BBC Radio on a series about the four MINT economies and has written about them as well.
In a Bloomberg article in November 2013, he pointed out that these countries “all have very favourable demographics for at least the next 20 years, and their economic prospects are interesting”.
Two months later, he wrote in BBC Magazine that if the four got their act together, some of them could match the double-digit growth rates that China enjoyed between 2003 and 2008.
But this was before the plunging oil prices and the Boko Haram insurgency began pulling down the Nigerian economy. And thus, it seems that Malaysia has taken the African nation’s place in the line-up of emerging economies most likely to do well in the next decade or so.
That’s mostly a good thing. It’s helpful when there’s an easy way to introduce Malaysia to foreign investors and businessmen, and to draw attention to Malaysia’s strengths and promise.
At the same time, being artificially linked to three other countries based on a set of data and selected common attributes, may lead to unfair comparisons or worse, being tarred with the same brush.
For now, the MIMT label is rather obscure. And perhaps it will remain so. But it’s best that Malaysia readies itself for the possibility of again becoming a rising star among the world’s economies. Such a status requires an assured management of expectations and the ability (and willingness) to make necessary changes, no matter how painful in the short term.
Executive editor Errol Oh dreams of a job of doing nothing but creating winning acronyms.
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