Mark Mobius’ money stuck in China, cautions investors; prefers India as alternative investment destination
Veteran emerging markets investor Mark Mobius, having learnt his lesson from investing in China, is rooting for India and Brazil as preferred investment destinations. “I can’t get my money out,” Mark Mobius said regarding his investment in China, adding that China’s new policies have “personally affected” him. The founder of Mobius Capital Partners has an account with HSBC in Shanghai which has been hit by restrictions. “I’m personally affected because I have an account with HSBC in Shanghai. I can’t get my money out. The government is restricting the flow of money out of the country. So I would be very, very careful investing in China,” he said in an interview with Fox Business.
According to Mobius, China’s economy is headed in a different direction from its former open-minded-market revolutionary leader, Deng Xiaoping. The government is taking shares in companies all over China to control them, leading to more control in the economy. Mobius believes this trend is not a good sign for the country’s future. In contrast, Hong Kong seems to be more open, and investors can get their money in and out of the financial center with relative ease.
The legendary investor recommended India as a viable alternative with immense economic opportunities. “You’ve got a billion people, they can do the same thing that the Chinese do. They can do the same kind of manufacturing and so forth,” he said. This isn’t the first time Mobius expressed confidence in India, believing in the country’s growth story. “Overall, I have confidence in India. With abundant talent and great companies, India has immense potential and any market volatility would be short-lived,” tweeted Mobius last month, amid the Adani group shares rout.
Regarding Brazil, Mobius highlighted that the country is more welcoming than China, and suggested that Brazil should be another investing destination. “I’m now in Brazil, and Brazil, you’ve got 250 million-plus people. Very good people, open society. Hey, why not come here? It’s another alternative,” Mobius said. Mobius’s comments come after the American Chamber of Commerce in China cited survey results, which revealed that US businesses operating in China are becoming increasingly pessimistic about their prospects in the country.