1. Emerging Markets Equity 8 November 2007 Mark Butler, Senior Investment Manager Aberdeen Asset Management

2. 1 Agenda What are drivers behind the re-rating in emerging markets? What to look for in emerging market companies Why GEM smaller companies?

3. 2 Emerging markets – Positioned for growth Expected growth rates higher than developed markets Positive demographics Corporate reform Development of domestic economies and the local investor base

4. 3 Breakdown of world growth Source: Deutsche Bank GDP growth in %

5. 4 Positive demographics should drive domestic demand * Other represents: Mexico, Turkey, Thailand, South Korea and South Africa Source: Bloomberg, Jun 05

6. 5 Corporate reform One class of share Novo Mercado in Brazil International Accounting Standards Focus on core business Return excess capital

7. 6 Development of domestic economies China: Annual disposable income per capita Source: CEIC Data, National Bureau of Statistics; Bloomberg, Datastream Emerging markets are a play on global growth Export growth is being recycled into domestic demand Development of domestic savings systems will provide support to financial markets 0 2,000 4,000 6,000 8,000 10,000 12,000 1992199419961998200020022004 2.4 2.5 2.6 2.7 2.8 2.9 3.0 3.1 3.2 3.3 Rural annual net income per capita Urban annual disposable income per capita Urban/rural income ratio (RHS) Rmb

8. 7 What to look for in emerging market companies Business prospects/strategy Evidence of industry growth, clear strategy and execution Management team Motivation, experience, do we trust them? Financials Strength of balance sheet, use of gearing Transparency Clean company structure, visible earnings, clear annual report Commitment to shareholder value Company is run for shareholders, not managers or controlling interests

9. 8 Why smaller companies? Smaller companies are under-researched Lack of attention and market inefficiency = mispricing Investment universe is huge and the opportunity to find well-run companies plentiful Corporate activity provides some uplift Small-caps more exposed to domestic activity and less vulnerable to external slowdown Discount is gone but small-caps have under-performed large-cap stocks of late Difficult to ‘cherry-pick’ small cap outperformance within larger fund MSCI has launched a GEM smaller companies index; asset class will become mainstream Aberdeen’s investment style ideally suited to exploiting opportunities

10. 9 Research coverage remains poor CountryIndexNo of listed companies JPM research coverage % coverage ChinaA + B Shares1,5001299% IndiaBSE7,484891% South AfricaJSE4226215% TurkeyISE335185% RussiaRTS378195% MexicoBMV317248% BrazilBovespa3467421% Source: JPMorgan

11. 10 Aberdeen Asset Management product offering Global Emerging Markets Smaller Companies ISIN LU0278937759 Bloomberg ticker: AEMSAUA LX Global Emerging Markets ISIN LU0132412106 Bloomberg ticker: ABEFROA LX