BANGKOK – The two Asian nations with the region’s best-performing stock markets in the past year are unlikely havens for investors: Thailand and the Philippines. Both are better known for troubled politics and natural disasters, but they have outshone higher-octane neighbors as new leaders nurture relative calm.
The PSE benchmark in the Philippines has soared 29 percent in the last 12 months, and Thailand’s SET index is up a whopping 33 percent. By contrast, an index compiled by MSCI that tracks stocks in 12 Asian countries is up a ho-hum 2 percent. The Shanghai Composite Index in rising power China has sunk nearly 14 percent.
The Philippines, long regarded as an economic backwater blighted by a succession of deeply corrupt governments, has gained a measure of credibility because of the stability ushered in by the 2010 election of President Benigno Aquino III.
Analysts credit him with boosting investor confidence by cracking down on corruption and living up to his promises of openness and good governance.
Thailand has also benefited from an improvement in its politics, although it’s unclear whether the current stability will endure.
The country seemed to be veering toward civil war in 2010 when deadly street battles raged in Bangkok between the army and loyalists of Thaksin Shinawatra, the populist prime minister ousted in a 2006 coup.
Local stock brokers were resigned to the Thai market lagging its potential, but the landslide election victory in 2011 of a pro-Thaksin party and the popularity of the country’s first female prime minister, Thaksin’s sister Yingluck, have boosted confidence.