Institutional investors will “return to fundamentals” and increase their allocations to frontier markets this year as a result of Europe and the US failing to resolve their sovereign debt problems, according to the chief executive of MENA-focused alternative asset manager Silk Invest.

Zin Bekkali said that the firm's central investment theme for 2012 is that "the political upheaval [in several Middle Eastern countries] that marked 2011 will eventually fade away and that investors will return to fundamentals and increase their allocations to frontier markets".