September 10, 2024 | News

Investing Expeditions | Saudi Arabia’s Vision 2030 and Beyond

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Key Takeaways
  • Saudi Arabia’s Vision 2030 plan is impacting the Kingdom’s economy and investment opportunities in the region.
  • Semiconductor companies are exploring new technology to help power fully autonomous vehicles.
  • Sustainability data is being compiled and analyzed to help inform investment decisions.
  • Initiatives such as nearshoring and markets such as industrial real estate are helping to propel Mexico’s economy.

Research trips are an integral component of our active, fundamental investment process. Our investment teams meet with different companies, attend conferences, and travel to new markets around the world, gaining insights for our clients and a deeper understanding of potential investments.

Below, we highlight some of the research trips our global equity and U.S. growth and core equity teams have taken.

Economic Diversification in Saudi Arabia

Bryan Shea, a research analyst on our global equity team, attended this year’s EFG Hermes conference in Dubai. The conference is the world's largest investment forum dedicated to the Middle East and North Africa (MENA) regions.

There, he learned how Saudi Arabia’s Vision 2030 plan is impacting the kingdom’s economy, and how it is actively working to diversify away from its reliance on oil revenues and promote sectors such as tourism, healthcare, education, and renewable energy.

In addition, he learned more about the investment incentives being implemented by the kingdom and the significance of prioritizing technology and innovation to drive economic growth.

“As we look ahead, we’re excited to monitor the development of this region and the investment opportunities likely to arise with it,” says Bryan.

Unveiling Innovation: Semiconductors, Spatial Computing, and Virtual Reality

Chris Sweeney next to an immersive VR machine that simulates gravity and acceleration

Pictured: Chris Sweeney next to an immersive VR machine that simulates gravity and acceleration.

While on a research trip to Las Vegas, Nevada, Chris Sweeney, a research analyst on our U.S. growth and core equity team, explored cutting-edge automotive computer systems for autonomous driving.

The trip revealed how semiconductor companies are racing to design platforms that power fully self-driving vehicles, and that spatial computing and virtual reality (VR) have combined to create digital twins of factories and worksites.

For Chris, one of the highlights of his trip was an immersive VR machine that simulates gravity and acceleration, allowing users to experience virtual tours of digital factory replicas. Overall, the trip showcased innovations that are shaping the future of transportation and industrial automation.

Sustainable Investing: Is Momentum Accelerating?

Blake Pontius, CFA, director of sustainable investing, attended the Responsible Investor Europe conference in June, where themes like sustainability, corporate disclosures, and data management took center stage.

“One key takeaway from this year’s event is the improving outlook for corporate disclosures that are relevant to investors. The launch of the ISSB framework last year has accelerated momentum on this front. It was interesting to learn that the ISSB standards have already been adopted by countries representing 50% of global gross domestic product (GDP) and 40% of global market cap,” says Blake.

In addition, “There was cautious optimism about the proliferation of sustainability data over the past few years. The challenge is quickly shifting from not having enough data to what do we do with it, how can it be organized and contextualized to inform investment decisions,” he concludes.

Mexico’s Property Panorama

Kalpit Shah, CFA, exploring an industrial real estate plant in Mexico

Pictured: Kalpit Shah, CFA, exploring an industrial real estate plant in Mexico.

Associate Research Analyst Kalpit Shah, CFA, explored Mexico’s industrial real estate industry during a research trip to Mexico City and Monterrey. He found that this industry faces near-zero vacancy, rising rents, and land supply constraints. It is also dominated by a few large players, with many smaller developers and landowners staying focused on logistics and serving major international clients.

But there are some concerns, including high informal employment, skilled labor migration to Texas, and greater security issues in northern regions compared to the center. Addressing these challenges is crucial to fully leveraging the potential for economic growth in Mexico's industrial real estate market.

In addition, Kalpit learned more about Mexico’s potential for robust economic growth, which has been driven by significant government spending and nearshoring. This optimism has been reinforced by increased U.S. engagement, including presidential visits, that highlights a strategic emphasis on regionalization and making North America a self-sufficient energy block.

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