Business Development
and Funding
Background
Institutional investors and private wealth in EM countries are looking for investment opportunities in alternative assets outside of their own country. In contrast to institutional investors in the industrial world that face tight liquidity constraints, institutional investors in selected EM countries are highly liquid and under-invested in markets outside of their own country due to only recent regulatory reforms and demographic factors.
Pension funds in Latin America alone manage assets totaling over $750 billion. In addition, net inflows are sizable due to the young labor force. Recent regulatory reforms have allowed a growing number of EM countries' institutional investors to invest abroad, including in the alternative asset classes.
Until recently, EM investors were able to gain double digit returns in domestic fixed income. Economic prosperity and financial stability have resulted in markedly lower real interest rates. EM wealth is now looking for investments based on portfolio allocation criteria.