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Subdued investment in Asia’s largest market, as well as fewer large-cap pan-Asia funds raising capital, rein in total EM activity levels despite bright spots in other regions, including Africa, other countries, such as Brazil and India, and certain sectors, such as oil & gas and fintech
After an unprecedented year for private capital activity in emerging markets (“EM”) in 2018, EMPEA’s Mid-Year 2019 Industry Statistics reveal a relative decline in the first half of the year as the fundraising and deal-making pace reverted to 2017 levels. Fund managers raised USD31.9 billion and invested US26.3 billion across all EM geographies and asset classes—inclusive of private equity and venture capital (VC), private credit, and private infrastructure and real assets—representing declines of 10% and 32%, respectively, year over year.
The decline in fundraising in 1H 2019 was expected given the sheer amount of capital raised in 2018, particularly in Emerging Asia and Latin America. Overall, managers raised USD27.2 billion for Emerging Asia private capital across all strategies in 1H 2019, compared to USD78.2 billion in all of 2018. With many of the region’s largest managers on the fundraising trail last year, Latin America also experienced a significant decline in the first half of 2019, with managers raising just USD1 billion. In contrast, Africa-focused fundraising appears to be on an upward trend after two slow years.