|
Laxman Pai, Opalesque Asia: Latin America's growing middle class and early pension reforms have created a significant pool of assets to invest in private capital, says a Preqin study.
The size of the private equity industry in Latin America has remained stable in recent years, despite challenges. As of June 2020, the total AUM stood at $28bn, including $7.2bn in dry powder.
The arrival of SoftBank's $5bn dedicated Latin America fund is starting to inject significant impetus into the sector, and government-backed incubators are creating an entrepreneurial ecosystem in Chile and Peru.
"Appetite for global alternatives is healthy among allocators in Latin America," said Preqin. An increasingly sophisticated investor base is eager to put capital to work with top-performing GPs, both locally and globally.
Recent reforms in Brazil may provide the stability that international private capital investors crave. A move towards central bank independence may help end the cycle of capital flight, inflation, and currency depreciation that has deterred some international investors. Social security reform promises to ease the country's challenging fiscal position.
"The region's gross domestic product fell an estimated 7.4% in 2020, according to the International Monetary Fund, compared to the 2.4% decline of the broader emerging markets and 4.9% drop in GDP for advanced economies. The pandemic put some alternative allocation plans on hold as investors throughout Latin Ameri...................... To view our full article Click here
|
RSS
