The Finance Professionals' Post

How and Where Should You Invest in Emerging Markets?

As the new year failed to ring in a solution to the debt crisis that has transfixed the eurozone, investors are left wondering whether now is the time to place their bets on potentially risky growth opportunities or to keep their assets in safe havens. Beyond Europe’s sovereign credit issues, other factors such as massive debt overhang, the threat of double-dip recessions, and ongoing money printing by central banks in the developed world call into question the traditional definition of “safe.” In this environment, some money managers are asking whether investing in emerging economies may, in fact, be safer than committing assets to developed markets.

Majority of US Finance Professionals Expect the Global Economy to Stagnate or Deteriorate

Is it time to stop thinking globally, and to start focusing locally? That’s more or less the consensus among more than 3,700 professional accountants who believe not only has international trade continued to dry up, but that the global economy will continue to erode while those industries that focus domestically will inspire greater confidence.

Regaining Investor Confidence for US-Listed Chinese Companies

A number of high profile scandals such as Longtop Financial Technologies and Sino-Forest have given Chinese companies a bad name among US investors. Portfolio managers who previously held extensive investments in US-listed Chinese equities now avoid the sector and some of the previously largest underwriters of US-listed Chinese equities have exited this market.

Between 2006 and 2010, a total of 339 Chinese companies listed on the major US stock markets, 106 on NYSE and 233 on NASDAQ. During this period of high interest in investing in Chinese companies, few anticipated the coming scandals and delistings.

The Hero or the Villain of the Euro

For more than two years, we have witnessed the demise of several European countries, starting with Greece’s shocking assertion in early 2009 that its deficit to GDP was more than double what had been presumed. Most investors and analysts were still not concerned since all major European countries enjoyed high investment grade ratings from the financial market’s watchdog—the major rating agencies. And, the traditional metrics for measuring sovereign debt performance, essentially all top-down macroeconomic indicators, were only just starting to signal a deteriorating scenario. The world’s financial community then began to systematically assess the health of several peripheral southern European countries (the so-called PIIGS [Portugal, Italy, Ireland, Greece and Spain]) leading to a spike in those nations’ required rates of returns on their Government’s debt. Finally, those lofty investment grade ratings began to tumble in 2010 and eventually the European Central Bank and its leading contributing countries were forced to set up rescue packages, first for Greece, then Ireland, now Portugal (still a work in progress).

Book Review: A Contest for Supremacy

The announcement that the United States will base 2,500 troops in Australia is a public recognition of the contest between China and the US for power in the Pacific, where the US has long been dominant. For China, the troop deployment increases fears of encirclement. For the US, it reflects fears of being pushed out or neutralized in this key geography. For an in-depth analysis of what will be an increasing contest, Aaron L. Friedberg's new book is a superb resource. Friedberg, a former fellow at the Smithsonian Institution’s Woodrow Wilson International Center for Scholars, the Norwegian Nobel Institute, and Harvard University’s Center for International, took part in a “review of China's economic performance, political stability, strategic intensions, and military power" during the Clinton administration. This review was the start of the research that produced A Contest for Supremacy: China, America, and the Struggle for Mastery in Asia.

How Bond Plays Work in a Market of Global Systemic Uncertainty

We recently spoke with Glenn Reynolds, CEO of CreditSights, who offered us some straight talk on how global credit market risk is impacting the broad capital markets. Reynolds will be a speaker at the upcoming NYSSA conference, Market Forecast: Turbulent Times, to be held on January 5.

Here he explains why he recommends a blended strategy of investing in high-yield corporate bonds as an equity surrogate and investment grade bonds as a defensive play to navigate what is likely to be continuing systemic market uncertainties.

The State of China’s Economy and US-Listed Chinese Companies

Ten years ago, when you read The Wall Street Journal, you barely noticed articles about Chinese public companies. Today, when you click your iPad app, WSJ.Com, China-related news generates daily headlines. On Oct 24 2011, the New York Society of Security Analysts (NYSSA) joined with China Council for International Investment Promotion (CCIIP) to host “2011 Chinese Companies Listed on US Market Development Forum”, which provided an opportunity for US investors to have an open dialogue with several Chinese companies. Not surprisingly, this forum drew a lot of attention from an audience that including both private and institutional investors. When analyzing the complex interdependent relationship between the fast-growing Chinese economy and the globally dominant US economy, one must understand three key points.

Russia: Some BRICs Are Different

Russia has always been different from the rest of the world. Even 20 years after the end of the Soviet Union and the Cold War, this author still finds it a little strange to find Russia grouped with other BRICs, or most emerging market countries. The others—China, India, and Brazil—all have very large portions of their populations struggling with poverty, and are characterized by historically limited, but now improving, access to technology. Not Russia.

Worldview Podcast: The Global Exchange of Workers

Richard G. Lipstein is a veteran executive search consultant and a member of Boyden’s global financial services practice, as well as currently serving as the chairman of the Career Development Committee at NYSSA. He provides insight into an interesting side-effect of globalization: the global exchange of workers.

If you want to watch the webcast of this entire event or any other NYSSA program, visit NYSSA's On-Demand website.

Worldview Podcast: Growth Rate of Emerging Markets

Thej Gurumurthy, the cofounder and COO of Syven Global Services, a research and analytics firm, points out the truth that comes with the modern, globalizing world: to succeed in business you have to be willing to look beyond US borders. Emerging markets (e.g. China, India, and even Russia) offer growth rates multiple times that of the US. 

If you want to watch the webcast of this entire event or any other NYSSA program, visit NYSSA's On-Demand website.

Worldview Podcast: Expecting the Unexpected

Thej Gurumurthy, the cofounder and COO of Syven Global Services, a research and analytics firm, shares a personal anecdote regarding the unforeseen pitfalls of doing business in our globalizing world. Corruption, he suggests, is an unfortunate fact of life in many places, and as difficult as it may be to understand and navigate these cultural differences, anyone doing business outside of their comfort zone must be prepared to deal with anything.

If you want to watch the webcast of this entire event or any other NYSSA program, visit NYSSA's On-Demand website.

Peru (Part II): Currency and Equities

CURRENCY: SHEDDING LIGHT ON THE NUEVO SOL | ACCESSING PERU'S EQUITIES | PERUVIAN EQUITY PERFORMANCE | EQUITIES, LOOKING FORWARD

Part I of Worldview’s Peru coverage discussed Peru’s recent macroeconomic history and political economy, noting that Peru has been an impressive economic story that has stayed largely under the media radar. The recent election of Ollanta Humala, a candidate with a history on the far left of the political spectrum has cast the future performance of the economy into question, even if—as part of his runoff campaign—he has promised to govern the country from center-left policies rather than the far-left of Peru’s political spectrum and his base coalition. This piece examines the performance of Peru’s currency and equity markets and considers the attractiveness of the asset markets going forward.

Understanding China’s Economic Indicators

China moves the markets. The world’s second largest economy, biggest source of growth, and most important consumer of commodities is an increasing focus of attention for investors.

But answering even simple questions about the size and growth of the Chinese economy is not straightforward. The official data is haunted by controversy, with widespread doubts about its accuracy.

Peru: Inca Gold Still Powers a People

PERU IN COMPARATIVE PERSPECTIVE | ECONOMIC GROWTH PATTERNS IN PERU | THE PERUVIAN POLITICAL-ECONOMIC SITUATION | 2011 ELECTIONS CONCERNS | PERU’S MACRO SUMMARY

While its neighbors Brazil and Chile capture much of the world’s attention, Peru has quietly grown into a star performer among emerging markets. Whether this continues as its newly elected leftist president Ollanta Humala takes the helm remains to be seen, but preliminary signs are hopeful, even if growth becomes more muted than in the recent past.

Peru has been known as a commodity exporter for much of its history, and this has been both a blessing and a curse. Properly managed, Peru’s resource wealth presents great opportunities, but countries whose economies are based on extractive industries tend to be wealth concentrators. The profits from concentrating industries are not always reinvested optimally and can become the enabler of corruption networks. Peru has struggled with this dynamic through much of the last century and even before, at times rising above it, and at other times becoming overwhelmed. Its most recent track record has been positive, however, and there are reasons to hope that it will continue.

Worldview: Summer Perspectives on the Arab Spring

It’s been scarcely six months since the start of what is now being called the “Arab Spring” : a series of revolts and, in some cases, the overthrow of authoritarian regimes in the Middle East. The conclusion of these events is yet uncertain even where revolts have thus far seemed “successful.” In this Wordlview special report, we offer some perspective on these events and suggestions on how to think about them as they evolve.

Worldview Podcast: What is Globalization?—A Primer

The term “globalization” is thrown around a lot. While it sounds good as a buzzword, understanding what it actually means is critical. NYSSA held a career chat to discuss this very issue, featuring speakers from all over the world, representing a number of career fields. The panel kicked off with a brief explanation, presented here in an excerpt as a helpful introduction to globalization.

If you want to watch the webcast of this entire event or any other NYSSA program, visit NYSSA's On-Demand website.

Worldview Podcast: Singapore, Globalization, and You

Blake Zhang had nearly a decade of experience working in Singapore before becoming a vice president at Daiwa Capital Markets America. Zhang provides valuable insight not only into Singapore's place in our quickly globalizing world, but also which economic and hiring strategies in use in Singapore truly exemplify that often hazy term.

If you want to watch the webcast of this entire event or any other NYSSA program, visit NYSSA's On-Demand website.

Book Review: Managing the China Challenge

Managing the China Challenge: How to Achieve Corporate Success in the People's Republic is an authoritative guide to China’s intricate political and business structure. Author Kenneth G. Lieberthal is the director of the John L. Thornton China Center at the Brookings Institution and was senior director for Asia on the National Security Council from 1998 to 2000. His new book is essential reading for anyone investing or doing business in China, where “the state is always your partner.”

Investment Issues in Emerging Markets: A Review

Because of their higher economic growth and potentially higher returns, emerging markets have received increasing attention from investors in the developed world. They are also said to provide diversification benefits for U.S. investors because of their low correlations with U.S. assets.

It is well documented that the benefits of international diversification within developed markets have declined over time because of increasing correlations. Emerging markets, however, offer both lower correlations and an expanded number of markets to invest in, as demonstrated in Goetzmann, Li, and Rouwenhorst (2005). More recently, Eun and Lee (2010) have confirmed that, although their performance is converging to that of developed markets, emerging markets are still more distinct from one another than developed markets are and still provide diversification benefits to the global investor.

Continue reading "Investment Issues in Emerging Markets" »

Book Review: When China Rules the World

The rise of China and the potential economic and political decline of the United States is a concern for many Americans. In When China Rules the World: The End of the Western World and the Birth of a New Global Order, Martin Jacques depicts a world in which Chinese influence is paramount. He challenges the assumption that China will adopt Western values. Chinese modernity, he argues, would be very different from Western modernity, and China would transform the world far more fundamentally than any other global power has done in the last two centuries.

Future of Microcap Rally Uncertain in 2011

As is traditional when an economy begins to recover, microcap and smallcap stocks have ruled during the past several years. From the spring of 2008 until this spring, the Russell 2000 Index of smallcap companies has outperformed the S&P 500 by a staggering margin. While the S&P 500 has returned just 2 percent on an average annual basis during that time, smallcaps have returned 9 percent.

BRICs versus CIVETS

The acronym BRIC—Brazil, Russia, India, and China—coined by the Goldman Sachs economist Jim O’Neill (2001) is now a widely accepted and understood term. The justification for such a grouping is clear, as the BRICs are comparable in terms of territory, population, GDP, stock markets, and sociopolitical factors (see Table 1). The acronym CIVETS—Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa—was conceived in 2009 by Robert Ward, director of global forecasting for the Economist Intelligence Unit (see Economist 2009), and popularized by Michael Geoghegan (2010), group chief executive of HSBC Holdings plc, shortly after. As the newer term makes its way into the investment lexicon, we need to ask whether these six countries merit such a grouping.

Investing in Indonesia (Part II)

INDONESIAN EQUITIES IMPRESS | RUMINATIONS ON THE RUPIAH | CONCLUSION

Worldview’s last piece on Indonesia highlighted the historical development of Indonesia’s economy and the success of its export-led growth model in spite of high corruption levels, legacy state-controlled enterprises, and political uncertainty in the aftermath of the Asian currency crisis and subsequent rise of Indonesian democracy. This follow-up article covers the recent performance of Indonesia’s equity and currency markets, putting Indonesia’s phenomenal gains in greater context.

Investment Issues in Emerging Markets: A Review

Emerging markets have generated considerable interest among investors and academics. Although their returns are increasingly converging to those of the developed world because of integration and liberalization, they still provide benefits to a global portfolio. This review reflects the latest practitioner and academic work on emerging market investing.

Read the full article for free at the CFA Institute site. 

Investing in Indonesia: The Tune of the Gamelan

INDONESIA IN CONTEXT | ECONOMIC AND POLITICAL HISTORY | ECONOMIC STRUCTURE AND RECENT PERFORMANCE | ECONOMIC, POLITICAL, AND NATURAL RISKS

The post-crisis performance of Indonesia has been phenomenal. With its overall economy virtually untouched by the financial crisis and its equity markets rapidly rebounding, Indonesia has outperformed virtually all major emerging-market competition, including Brazil. What characteristics have brought about this growth and expansion, and to what extent are these trends likely to continue?

Commentary: As Goes Egypt . . .

I am no Middle East expert, and clearly there are a multitude of factors beyond a humiliated fruit cart vendor in Tunisia that have triggered the revolutions playing out on our nightly news. Certainly decades of repression and unfathomable corruption (Mubarak is thought to have in excess of $40 billion invested securely outside Egypt) are the primary drivers. But I would like to focus on food and energy. A consensus is emerging that dramatic increases in food prices are also a root cause of the revolutions in Tunisia and Egypt, as reflected by an article in Scientific American titled: “Are high food prices fueling revolution in Egypt?”

Returning as a Tiger: The Economic Reincarnation of India (Part II)

INDEX: INDIAN PUBLIC EQUITIES | VALUATIONS IN INDIA ARE REASONABLE | CURRENCY: SHOULD ONE BE A RUPEE GROUPIE? | CONCLUSION: PORTFOLIO DHARMA

The first part of this article discussed recent economic developments in India and the prospects for high growth rates over the long term. Part II covers the performance of the equity and currency sectors and offers compelling reasons to include India in either a global or EM (emerging-markets) portfolio.

India has been on investors’ radar screens since at least 2000, but it has rocketed to even greater prominence in the post-crisis recovery. Its major stock index, the Sensex 30, has grown more than 125% since its low in March 2009, outpacing the S&P 500 Index (up 82% since March 2009), China’s Shanghai Composite (up 65% since October 2008), and even the highly popular Brazilian Bovespa (up 115% since December 2008). India-related ETFs have proliferated, allowing easier access to Indian market returns. The emphasis on the centrality of China in the global economy can make it easy to miss the opportunities offered by China’s neighbor.

Returning as a Tiger: The Economic Reincarnation of India

INDEX: INDIA IN COMPARATIVE PERSPECTIVE | GEOPOLITICAL, DOMESTIC, AND ENVIRONMENTAL RISKS | RECENT ECONOMIC PERFORMANCE

For those who grew up with images of India as a land of poverty, recent news would seem veritable proof of economic reincarnation. Indian poverty still exists, of course, and in a land of more than one billion people, a 25% poverty rate means that at least 250 million people—or more than three-quarters of the US population—still live in highly precarious conditions. It will be a long time before its poverty can be eradicated, but India can boast of many recent achievements, and there are good reasons to expect that the country will continue to grow and develop rapidly as it has over the last decade. Investors are naturally interested in how to participate in this story.

On the Shores of the Black Sea: Will Romania's Economy Sink or Swim?

HISTORICAL AND REGIONAL CONTEXT | ECONOMIC STRUCTURE | EQUITY PERFORMANCE | IN SUMMARY

Romania, a country famed for its Olympic gymnasts, has often required its citizens, investors, and business community to perform some economic gymnastics of their own. After the hyperinflation crises that accompanied the transition to capitalism in the 1990s, Romanian equities vaulted upward between 2003 and 2007. However, those jumping into Romania’s stock market after mid-2007 may have felt as though they have had their own personal encounter with Vlad the Impaler, another famous Romanian.

Update on Brazil: More Than a One-Note Samba, But Changing Key

INDEX: WEATHERING THE CRISIS | EMERGING RISKS IN BRAZIL | A CROWDED TRADE | CHANGING POLITICS | THE IRRESISTIBLE COOKIE JAR (PETROBRAS) | OVEROPTIMISM AND “BRASIL GRANDE” | SUMMARY

Worldview first covered Brazil in the Winter 2009 edition of The Investment Professional. At the time, when it was not entirely clear that the dramatic crash of late 2008 had fully run its course, this column argued that investors willing to invest or hold on to their Brazilian exposure would likely find their patience rewarded. There were several arguments in favor of Brazil:

1. Extensive Brazilian experience in surviving and adapting to economic shocks.
2. Large foreign reserves and manageable debt loads, shielding Brazil’s government from fiscal and political crisis.
3. Highly professionalized fiscal and monetary authorities.
4. A substantial domestic sector that could buffer reduced international demand.
5. A more diversified export base than generally appreciated by most investors.
6. (Exports diversified by both export destination and industry.)
7. Foreign investors predisposed to run at the first sign of trouble in Brazil, providing an opportunity to enter at attractive valuations.
8. Attractive correlation (i.e., diversification) features.

Mongolia, Part II: Should One Tempt the Wrath of Khan?

INDEX: MONGOLIAN EQUITIES | CURRENCY: THE TÖGRÖG (TUGRIK) | INTEREST RATES | SUMMARY

This article follows Worldview’s earlier report on Mongolia and presents the recent performance of Mongolian equities, currency, and interest rates. One of the challenges of investing in Mongolia is that data is harder to come by than for many other emerging markets, and so this presentation will not be able to perform the full sets of analysis that have traditionally been a part of Worldview articles. For example, MSCI does not keep an index, total return or otherwise, on the Mongolian market. We do, however, take what data is available use it in the most meaningful ways available.

Free Lunch in Emerging Markets: Evidence from Latin America

What does a US investor stand to gain from international portfolio diversification? This analysis discovers that diversification benefits would have made it beneficial for an investor with any risk profile to include emerging Latin American market indexes in a US portfolio from 1992 to 2006, rather than investing solely in S&P.

Although several studies exist on the benefits of international diversification (e.g., Grubel 1968; Levy and Sarnat 1970; Lessard 1973; Odier and Solnik 1993; and Eun and Resnick 1994), the benefits to the foreign investor in emerging Latin American markets are still under-researched. In addition to the question of whether it’s worthwhile for US investors to include emerging Latin American market equities in their portfolios, there is also the issue of what the optimal portfolio mix for such investors would be.

Mongolia: BRIC-ing Up is Hard to Do

INDEX: MONGOLIA IN COMPARATIVE CONTEXT | GEOGRAPHIC CONSTRAINTS AND ECONOMIC VULNERABILITIES | HISTORICAL BACKGROUND | ECONOMIC GROWTH AND STRUCTURE | ECONOMIC RISKS | SUMMARY

Mention Mongolia, and most people will conjure images of horse-mounted hordes rushing across the Asian steppes, building the largest land empire the world has ever seen. While Mongolians are understandably proud of their heritage, which has included ruling three present-day BRICs (China, India, Russia), much of the Middle East and parts of Eastern Europe, the Mongolia of today is a much smaller affair, consisting of just over three million people—approximately the population of Jamaica—scattered across an area roughly the size of Iran.

Turkey Navigates the Straits of a Crisis (Part II)

LYRICAL LIRAS | FIXED INCOME: CLOSER TO INVESTMENT GRADE | TURKISH EQUITIES: FAST-GROWING BUT VOLATILE

In an earlier article, we discussed the strength and attractiveness of the Turkish economy. In part II of Worldview: Turkey, we will look at the currency, fixed income, and equity markets. In brief, Turkey has many attractive emerging market characteristics, but its risk-adjusted performance as an equity investment, while positive, has not been as outstanding as its economic performance would suggest it could be.

Turkey Navigates the Straits of a Crisis (Part I)

HISTORY AND COMPARATIVE CONTEXT | ECONOMIC STRUCTURE

It is almost cliché to call Turkey a bridge between worlds, but on closer inspection, the country is difficult to describe as anything else. With a foot in Europe and a foot in Asia, Turkey truly is a crossroads between the East, West, and Middle East, a role shaped by its location and cultural geography, as well as its history.

Egypt Delivers Impressive Results, But with Risks

FROM SOCIALIST TO QUASI-LIBERAL ECONOMICS | ECONOMIC STRUCTURE | EQUITY MARKETS | HIDDEN RISKS BENEATH THE SAND

Egypt—land of pyramids, sphinxes, and pharaohs—is changing with the times. Political and economic liberalization in the 1990s and 2000s has made Egypt an exceptional frontier market that is still worth investigating as part of an asset allocation. Although equity performance has been extraordinary and the chronic currency devaluations of earlier years have largely passed, investors should be aware of the political risks stemming from Egypt’s authoritarian political structure, aging president, highly unequal wealth distribution, and fundamentalist social movements.

South Africa May Join the Vanguard of Developing Markets

A COMPARATIVE PERSPECTIVE | ECONOMIC STRUCTURE | CURRENCY | EQUITY | IN SUMMARY

The uniting of Brazil, Russia, India, and China under the acronym BRIC constitutes an acknowledgment of the significant role that developing economies are likely to play in future global growth and investment opportunities. BRIC encapsulates the importance of the three largest developing countries (Brazil, India, China) and stresses the notability of economic transitions in formerly socialist countries such as Russia. But as interest in BRIC has heated up, Africa—traditionally a central topic in economic development work—has been conspicuous by its absence. In many ways, however, the nation of South Africa can be thought of as the African BRIC: all in all, it’s just another BRIC in the emerging market wall.

The Philippines is Buffeted by Stormy Politics and Natural Disasters

THE PHILIPPINES IN COMPARATIVE PERSPECTIVE | ECONOMIC HISTORY | ECONOMIC GROWTH AND DEVELOPMENT | EQUITIES: LESS VOLATILE, BUT MEANDERING | CONCLUDING THOUGHTS ON RISK AND RETURN

The Philippines is a key participant in Asia’s growth story: one of the few countries that can be described as a former US colony, it has many characteristics that should make investors at least pause to investigate. The US colonial heritage, for one, has left in place an economic culture favoring markets and capitalism. Low-cost, relatively educated, English-speaking labor has meant that Philippine call centers and other business-service providers can compete with India for business from firms that are offshoring their business processes. Extensive mineral deposits can also feed China’s voracious commodity appetite. Nonetheless, political and geographic factors create risks that have handicapped economic performance to below what traditional economic indicators would suggest is possible.

Is Vietnam Another China?

THE GIANT NEXT DOOR: COMPARING VIETNAM AND CHINA | RECENT INDEX PERFORMANCE IN VIETNAM | SOME QUANTITATIVE FEATURES OF VIETNAM’S EQUITY INDEX | VIETNAMESE PERFORMANCE: SHORT-TERM ISSUES | IN SUMMARY

Interest in Vietnam exploded in 2006 when the Ho Chi Minh stock index (Bloomberg: VNINDEX:IND) grew 144% in one year, forcing global and emerging-market investors to sit up and take notice. Those fortunate enough to catch the “sweet spot” of that growth—from January 31, 2006, to February 28, 2007—saw a 264% capital gain in just 13 months. Vietnam realized the highest gains of any emerging market in a year when emerging markets were one of the strongest asset classes around, prompting investors and emerging-markets strategists to wonder if Vietnam might be “the next China.”

Vietnam exhibits many characteristics of a new “Asian Tiger.” However, a comparison with China, a look at Vietnam’s evolving equity market, and contextualization of Vietnam’s near-term economic issues all point to a key constraint: Vietnam lacks China’s scale. Its capacity to absorb large-scale investments is very small in comparison to China’s, and its liquidity risk is greater. But for smaller investors, Vietnam offers diversification benefits that could balance out some of the political risk of Chinese investments.

Surfing the Tsunami: Brazilian Markets and the Global Crisis

INDEX: EQUITY AND CURRENCY | STRENGTH IN DIVERSIFICATION | IN SUMMARY: STRONG BUT NOT IMMUNE

Brazilians often point out proudly how blessed their land is. “Brazil has no natural disasters: no earthquakes, no tornadoes, no volcanoes, no hurricanes,” they say. Some add, chuckling lightly, “Our disasters are all man-made!”

The financial crisis engulfing the globe has arrived recently on Brazil’s shores. Brazil is no stranger to financial and political stress; indeed, over the last thirty years, the country has endured debt crises, extended hyperinflation, currency crashes, seven currency changes, economic recession, unemployment, the transition from military to civilian government, presidential resignation to avoid impeachment, banking failures, and, more recently, a period of rapid domestic and export growth that breaks with traditional experience. The consistent theme throughout these challenging years has been Brazil’s resilience: both economic and social.