By John Wasik
Nov 11 The financial troubles of Europe and the
U.S. have become fiscal soap operas on a grand scale. If you're
an individual investor, where can you escape the endlessly
singing fat lady?
There are just a handful of countries that are reasonably
solid long-term investments. They are not without risk, yet
their leaders have managed their economies better than most
industrialized nations and they are thriving. The healthiest
economies also managed to invest in their countries while
avoiding the banking cyclones that are ravaging the U.S. and
Here are four places with a positive story: gross domestic
product growth (GDP), top sovereign debt ratings, low or no
budget deficits (relative to larger industrialized nations) and
healthy domestic investment.
Anchored at the crossroads of Asia, this island nation is
hardly blessed with abundant natural resources. It's dependent
upon its neighbors for nearly everything -- except human
capital. In this regard, it's leveraged its resources well.
It's picked its niches carefully, excelling in financial
services, pharmaceuticals and information technology.
As a result, its economy grew almost 15 percent last year.
The government has embarked on a long-term program to turn the
country into Southeast Asia's major trading and technology
nexus. As one of the wealthiest nations in Asia, it has a low
jobless rate and small budget surplus; its per-capita GDP ranks
it among the highest in the developed world. You can invest in
a basket of Singapore stocks through the iShares MSCI
SingaporeIndex ETF .
The smallest continent is home to some of the world's
largest mining operations and has plenty of customers from
China and India. Its economy enjoys about 3-percent annual
growth, it has a trade surplus, and a small budget deficit that
may vanish in four years. The country only suffered one quarter
of negative economic growth after the 2008 meltdown.
Prior to that, the Aussies experienced 17 straight years of
expansion. It's negotiating free-trade deals with China, Japan
and Korea and has everything from coal to uranium to sell to
Asian markets. One of the best ways to sample Australian stocks
is through the iShares MSCI Australia Index ETF . Like
most ETFs, it reflects the lion's share of public companies in
Canada not only largely avoided the 2008 meltdown, it's
benefiting from being the largest U.S. energy trading partner.
Thanks to conservative bank-lending practices, Canada's banks
emerged stronger than other North American megabanks after the
crisis. A major exporter of oil, gas and uranium, the country
is seeking to build a pipeline to route even more oil from its
Western fields -- the controversial Keystone XL project.
Canada will continue to benefit from the voracious appetite
in the developing world for commodities. Since its entire labor
force is only 18 million -- there are more people living in the
Northeastern U.S. -- Canada has plenty of resources to spare.
Consider the iShares MSCI Canada ETF as a way to invest
in the country's largest companies.
This Scandinavian nation isn't on most investors' radar
screens, even though it has plenty of hydropower, oil and a
small population to support. While its GDP growth is minuscule,
it has low unemployment and a budget surplus.
As the world's second-largest natural gas exporter, the
country shares the wealth with its people through various
social safety-net programs, and saves for the future with a
half-trillion-dollar sovereign wealth fund, which ranks among
the largest in the world. Norwegians are among the most
prosperous people on earth. You can invest through the Global X
FTSE Norway 30 Index ETF .
If you bundle up your savings and invest in all of these
ETFs, you'd be still subject to global market risk. If the
European debt contagion somehow infects North American or Asian
economies, then that could trigger downturns in emerging
For big commodity and energy producers, contagion could be
toxic -- even my favored countries are certainly not completely
immune. So think long-term and keep on diversifying risk away
from countries with the worst balance sheets. Walk away from
the noise to countries with poise.