The economies of Central Asia have benefited due to their abundance of natural resources. Especially in the exports of fuels such as oil and coal. The other natural resources that have brought a boost in these economies are the precious metals such as gold, silver, zinc, lead, copper and the high profile -uranium. The investments flowing in from China have been favorable for the energy and transportation industry of Central Asia.
This trade between the two has seen a growth of approximately 25% as per the National Bureau of Statistics of China. Mongolia has been significantly growing in terms of its GDP and is currently posted itself as the second fastest growing economy. Basic Materials Industry and the energy Industry comprise of the major industries with the biggest stakes of the Central Asia ETF, with the financial and telecommunications industry coming up next. This index gathers revenues from Mongolia, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. Central Asia Mutual Fund gives the investors a relatively cheap exposure to the various companies of this Central Asia Zone which play a very important role in building revenues from this region.
Soon after the Soviet Union broke up into different independent Nations, the World's economy wondered whether these nations of Central Asia would be able to face the competition of the 21 Century. There were a whole lot of complexities and hurdles before them and their civil wars were pulling them down further.
These independent Nations of Central Asia proved the World Economies wrong and have let their presence felt in the world economy. This part of the world now is the most business friendly region, much more than anticipated than their counterparts, namely East Asia.
At this point of time China is the biggest back up and plays a very important role in the East Asia power. China invests hugely in gas pipelines with Central Asia and has granted ample loans to the Central Asian economies, focusing especially on the telecommunications and agricultural sectors. In the year 1992 Kazakhstan and China had signed an agreement for building a pipeline from the Caspian shore to Xinjiang to be able to import oil, which is scheduled to complete in 2014. This has absorbed a huge amount of investment. There are many such projects scheduled to be built for importing oil or gas. The beneficiary economies experience flows of investment into their infrastructures with these projects. This only further helps to expand the business operations among the Central Asian economies.
These independent nations have created rather simple and straight forward business environments, where the taxation and property, institutional and regulatory reforms are handled with ease and efficiency, encouraging growth with the neighboring countries. The reform agendas are put to disposal for enabling economic integration. No wonder the funding vehicles such as Mongolia ETF and Central asia fund are finding their places in the baskets of the investors.
The Mongolia etf is one of the latest ETF's to join the bandwagon belonging to one of the rapidly growing economies of the Frontier Countries. At the time of the collapse of the Soviet Union Mongolia saw a stage of recession. It is amazing to see this economy grow at such a fast rate. Mining and the production of cashmere are the prime industrial activities. The trade regime of Mongolia is extremely open and the boom of the mining industry has helped the growth of the economy in becoming a more vibrant and modern economy. The population of this country is at 2.8 million and the GDP growth rate is at 17.3%. The mining sector of this economy is the highest influencer of the foreign investments.
Global X Central Asia ETF [AZIA] delivers as per the performance of Solactive Central asia fund and Mongolia Index. This index was introduced in February 2013 and KAZMUNAIGAS, EXPL GDREURASIAN NAUTRAL RES, KAZAKHMYS are the major central asia equity that makes the top three assets for the fund as on 07/23/2013. This fund only charges investors 69 base points a year in terms of total annual Fund operating expense.