This article has two premises:
- That average long-term growth in the value of stocks corresponds to long-term growth of an economy, and
- That long-term growth of the economy is generally correlated with population growth.
In Table B at the end of this article I have listed countries by population growth rate (per the 2009 CIA World Fact Report information found on Wikipedia), and listed ETFs for individual countries (Mark Kennedy article on About.com). In Table A I have pulled out the countries with highest population growth rates that also have single-country ETFs. Table A also includes the ranking of those countries by ease of doing business (World Bank) and economic freedom (Heritage Foundation and Wall Street Journal).
Some comments and surprises
First, the United States has the fastest-growing population of any major economy, and one of the fastest population growth rates of any developed country (Israel, Ireland and Australia have faster growing populations). When we consider the U.S. rating for ease of doing business and economic freedom, this is a surprisingly good place to invest for the long term.
Every country and region has its own issues. Civil wars, famines, civil unrest, changes in governments and government policies have happened through out history, but seem more common where there is fast population growth. The faster growing population regions are also usually the less developed. Betting on fast-growing population countries is partially a gamble that the culture and governments will evolve over time to be more open and more friendly to business. Investments in many of these countries involve very high risk and will probably experience high volatility.
The fastest-growing population regions are the Middle East and Africa. With a few exceptions (Egypt and South Africa), ETFs are not yet available for individual countries in these regions. However, regional ETFs include: AFK, for Africa, and GAF for the Middle East and Africa.
The slowest-growing regions include most of the former European Communist block, specifically, Eastern Europe and the northern former members of the Soviet Union, including Russia, Georgia and the Baltic States. In addition, Northern Asia is growing slowly, including Japan (negative growth), China, and South Korea. Western Europe with the exception of Ireland is growing slowly.
Latin America and parts of Asia (especially South Asia) have some fast-growing countries, but the region generally has more moderate growth compared to Africa and the Middle East.
Below in Table A is a list of the countries with ETFs that have population growth rates greater than the United States (plus New Zealand which is quite close).
In my humble opinion, of the countries with single-country ETFs, the following countries seem to have the best combination of high population growth rate, ease of doing business, and economic freedom: Malaysia, Israel, Turkey, Peru, Columbia, Australia, Mexico, Ireland, Singapore, United States, and New Zealand.
Investing in population growth is a very long-term investment - my version of "buy and hold." I presently intend to buy population growth country stock on dips and when the business climate of a country starts to improve.
Table A
| Country | Annual Population Growth | Single country ETFs | Ease of doing Business Ranking out of 183 countries | Economic Freedom |
| Egypt | 2.03% | EGPT | 94 | 96 |
| Philippines | 1.96% | EPHE | 148 | 115 |
| Malaysia | 1.72% | EWM | 21 | 53 |
| Israel | 1.67% | EIS | 29 | 43 |
| India | 1.41% | EPI, INCO, INDY, INP, INXX, PIN, SCIF, SCIN | 134 | 124 |
| Turkey | 1.31% | TUR | 65 | 67 |
| Peru | 1.23% | EPU | 36 | 41 |
| Colombia | 1.22% | GXG, COLX | 39 | 45 |
| Brazil | 1.20% | BRAQ, BRAZ, BRF, DBBR, EWZ, EWZS, FBZ, UBR | 127 | 113 |
| Australia | 1.20% | EWA, KROO | 10 | 3 |
| Vietnam | 1.14% | VNM | 78 | 139 |
| Indonesia | 1.14% | EIDO, IDX, INNN | 121 | 116 |
| WORLD | 1.13% | |||
| Mexico | 1.13% | EWW, MEXS | 35 | 48 |
| Ireland | 1.12% | EIRL | 9 | 7 |
| Argentina | 1.05% | ARGT | 115 | 138 |
| Singapore | 1.00% | EWS | 1 | 2 |
| United States | .98% | Too numerous to list | 5 | 9 |
| New Zealand | .94% | BNZ, ENZL | 3 | 4 |
List of countries by population growth rates greater than the world average (and some additional countries listed for comparison) and corresponding ETFs for individual countries.
Table B
| Country | Annual Population Growth Rate (2009 List by the CIA World Factbook as cited by Wikipedia) | ETFs and ETNs | ||
| United Arab Emirates | 3.69% | |||
| Burundi | 3.69% | |||
| Niger | 3.68% | |||
| Kuwait | 3.55% | |||
| Gaza Strip | 3.35% | |||
| Mayotte | 3.32% | |||
| DR Congo | 3.21% | |||
| Ethiopia | 3.21% | |||
| Oman | 3.14% | |||
| Burkina Faso | 3.1% | |||
| Sao Tome and Principe | 3.09% | |||
| Madagascar | 3.00% | |||
| Benin | 2.98% | |||
| Rwanda | 2.87% | |||
| Western Sahara | 2.83% | |||
| Somalia | 2.82% | |||
| Yemen | 2.79% | |||
| Comoros | 2.77% | |||
| Congo, Republic of the | 2.75% | |||
| Togo | 2.75% | |||
| Malawi | 2.75% | |||
| Senegal | 2.71% | |||
| Equatorial Guinea | 2.70% | |||
| Uganda | 2.69% | |||
| Kenya | 2.69% | |||
| Liberia | 2.67% | |||
| Mali | 2.51% | |||
| Gambia, The | 2.59% | |||
| Eritrea | 2.58% | |||
| Afghanistan | 2.58% | |||
| Guinea | 2.57% | |||
| Turks and Calcos Islands | 2.56% | |||
| Iraq | 2.51% | |||
| Mauritania | 2.40% | |||
| Cayman Islands | 2.39% | |||
| Solomon Islands | 2.39% | |||
| Paraguay | 2.36% | |||
| Laos | 2.32% | |||
| Anguilla | 2.27% | |||
| Kiribati | 2.24% | |||
| Cameroon | 2.19% | |||
| Jordan | 2.19% | |||
| Sierra Leone | 2.18% | |||
| West Bank | 2.18% | |||
| Libya | 2.17% | |||
| Djibouti | 2.16% | |||
| Belize | 2.15% | |||
| Sudan | 2.14% | |||
| Cote d'Ivoire | 2.13% | |||
| Angola | 2.10% | |||
| Papua New Guinea | 2.09% | |||
| Marshall Islands | 2.08% | |||
| Chad | 2.07% | |||
| Guatemala | 2.07% | |||
| Tanzania | 2.04% | |||
| Egypt | 2.03% | EGPT | ||
| Timor-Leste | 2.03% | |||
| Guinea-Bissau | 2.02% | |||
| Syria | 2.01% | |||
| Honduras | 2.00% | |||
| Nigeria | 2.00% | |||
| Macau | 2.00% | |||
| Philippines | 1.96% | EPHE | ||
| Botswana | 1.94% | |||
| Gabon | 1.93% | |||
| Ghana | 1.90% | |||
| Tajikistan | 1.88% | |||
| Saudi Arabia | 1.85% | |||
| Haiti | 1.84% | |||
| British Virgin Islands | 1.84% | |||
| Mozambique | 1.79% | |||
| Nicaragua | 1.78% | |||
| Bolivia | 1.77% | |||
| Cambodia | 1.77% | |||
| Brunei | 1.76% | |||
| Nauru | 1.75% | |||
| Malaysia | 1.72% | EWM | ||
| Cyprus | 1.69% | |||
| Israel | 1.67% | EIS | ||
| El Salvador | 1.66% | |||
| Zambia | 1.63% | |||
| Tuvalu | 1.62% | |||
| Pakistan | 1.56% | |||
| Zimbabwe | 1.53% | |||
| Venezuela | 1.51% | |||
| Panama | 1.50% | |||
| Ecuador | 1.50% | |||
| Mongolia | 1.49% | |||
| Central African Republic | 1.49% | |||
| Dominican Republic | 1.49% | |||
| Tonga | 1.48% | |||
| Aruba | 1.48% | |||
| India | 1.41% | EPI, INCO, INDY, INP, INXX, PIN, SCIF, SCIN | ||
| Vanuatu | 1.40% | |||
| Kyrgyzstan | 1.40% | |||
| French Polynesia | 1.39% | |||
| Fiji | 1.38% | |||
| Costa Rica | 1.36% | |||
| Samoa | 1.35% | |||
| Turkey | 1.31% | TUR | ||
| Swaziland | 1.31% | |||
| Antigua and Barbuda | 1.30% | |||
| Bahrain | 1.27% | |||
| Bangladesh | 1.29% | |||
| Nepal | 1.28% | |||
| Bhutan | 1.27% | |||
| Peru | 1.23% | EPU | ||
| American Samoa | 1.22% | |||
| Colombia | 1.22% | GXG, COLX | ||
| Brazil | 1.20% | BRAQ, BRAZ, BRF, DBBR, EWZ, EWZS, FBZ, UBR | ||
| Algeria | 1.20% | |||
| Australia | 1.20% | EWA, KROO | ||
| Luxembourg | 1.17% | |||
| San Marino | 1.15% | |||
| Turkmenistan | 1.14% | |||
| Vietnam | 1.14% | VNM | ||
| Indonesia | 1.14% | EIDO, IDX, INNN | ||
| New Caledonia | 1.14% | |||
| Andorra | 1.14% | |||
| WORLD | 1.13% | |||
| Mexico | 1.13% | EWW, MEXS | ||
| Ireland | 1.12% | EIRL | ||
| Lebanon | 1.11% | |||
| Suriname | 1.10% | |||
| Morocco | 1.10% | |||
| Argentina | 1.05% | ARGT | ||
| Seychelles | 1.00% | |||
| Singapore | 1.00% | EWS | ||
| Tunisia | .98% | |||
| United States | .98% | Too numerous too list | ||
| Some selected countries listed below for comparison | ||||
| New Zealand | .94% | BNZ, ENZL | ||
| Iran | .88% | |||
| Chile | .88% | ECH | ||
| Canada | .82% | CNDA, CNPF, DBCN, ENY, EWC, TSXV | ||
| Thailand | .63% | THAI, THD | ||
| France | .56% | EWQ | ||
| Hong Kong | .50% | EWH, HKK | ||
| Sweden | .48% | EWD | ||
| China | .47% | GXC, (and others too numerous to list) | ||
| United Kingdom | .47% | EWU | ||
| Netherlands | .41% | EWN | ||
| Norway | .34% | GXF, NORW | ||
| South Africa | .28% | EZA | ||
| Denmark | .28% | |||
| Switzerland | .28% | EWL | ||
| Portugal | .28% | |||
| South Korea | .27% | EWY, FKO, SKOR | ||
| Cuba | .23% | |||
| Taiwan | .23% | EWT, TWON | ||
| Greece | .13% | |||
| Finland | .10% | |||
| Belgium | .09% | EWK | ||
| Spain | .07% | EWP | ||
| Austria | .05% | EWO | ||
| Italy | -.05% | EWI | ||
| Poland | -.05% | EPOL, PLND | ||
| Croatia | -.05% | |||
| Germany | -.05% | EWG, GERJ | ||
| Czech Republic | -.09% | |||
| Romania | -.015% | |||
| Japan | -.19% | EWJ (and others too numerous to list) | ||
| Hungary | -.26% | |||
| Lithuania | -.28% | |||
| Georgia | -.33% | |||
| Belarus | -.38% | |||
| Russia | -.47% | ERUS, RBL, RSX, RSXJ | ||
| Serbia | -.47% | |||
| Latvia | -.61% | |||
| Estonia | -.63% | |||
| Ukraine | -.63% | |||
| Bulgaria | -.79% | |||
| And the winner: Northern Mariana Islands (inexpensive real estate may be available here) | -7.08% |
Note: This article is provided for informational and educational purposes only, and is not a solicitation or suggestion that you make any specific investment. Investing is a very risk enterprise so consult with a professional advisor and/or do your own research before making any investment.
Disclosure: I am long EPHE, INP, EWZ, THD, EWS, EWY, EWM, EMB, EGPT, IDX, AFK, PIN. I may buy ETFs or ETNs listed in this article within the next 72 hours, or expand my present holdings within such time.
