For decades, Mexico remained under the radar as private equity investors with an interest in Latin America poured their money into Brazil. Headline risk around corruption and the war on drugs, a relatively small pool of fund managers, and the high concentration of large, family-owned businesses potentially restricting deal flow were among the many factors that had deterred greater investment. However, the tide appears to be turning—particularly with the entrance of the local pension funds (or Afores), which in 2009 were given the freedom to invest 10% of their assets into private equity under new regulations. Since this time, fund sizes for the more established general partners in the region have grown, while the total number of private equity and venture capital funds operating in the market has multiplied. In the eight years leading to 2016, Mexico-dedicated funds had raised nearly US$8.7 billion, with an additional portion of the US$12.7 billion raised by regional funds earmarked for the market
Environmental, social and governance (ESG) is a broad term used to define a variety of non-financial investment issues. Developing a nuanced understanding of these issues is imperative for industry practitioners and stakeholders as investor attention to ESG matters increases. The growing importance of ESG in the private equity industry is evident in the proliferation of available resources and content on the subject. EMPEA has created and updated this ESG Reference Guide in an effort to facilitate this information exchange and communicate the availability of these resources.
The DFI Council's collaboration is a published directory of development finance institutions investing in private equity and structured debt in emerging markets. Compiled with the detailed contributions of Council members, the directory provides valuable information to the global industry about DFI activities, including investment priorities, fund manager criteria, and investment structures.
Offshore jurisdictions are the primary conduit for private equity funds investing in Sub-Saharan Africa today. However, two forces are contributing to a growing interest in the use of onshore jurisdictions for fund structures. Outside of Africa, some global investors and civil society organizations have cited concerns about the transparency and tax practices of offshore jurisdictions; while within Africa, local institutional investors are increasingly looking to invest in private equity, but through onshore jurisdictions. This joint report, undertaken with FSD Africa, contains findings from a survey of 118 industry professionals regarding their views toward African fund domiciles, as well as five expert papers on African financial hubs and their relevance to the private equity industry.
The power sector in emerging markets (EM) is increasingly on the radar screens of international investors. Demand for electricity in developing economies is high and will only grow, requiring substantial additional investment in both the modernization of outdated power infrastructure and in building new capacity in order to meet the needs of consumers and businesses. As this report uncovers, electricity supply and demand dynamics in emerging markets—coupled with regulatory environments that have evolved towards increased private participation in the power sector—underpin an opportunity for private investment fund managers (GPs) and their limited partners (LPs) to not only earn compelling returns, but also drive further economic growth and welfare gains by increasing access to reliable and affordable power.
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