Research

Key findings from the 2018 Global Limited Partners Survey include:

• A higher proportion of respondents* plans to increase the dollar value of their commitments to EM PE than in any edition of the survey since 2014, suggesting cautious optimism may be in order for EM-focused fund managers.
• LPs’ reasons for increasing their commitments to EM PE appear to be evolving. When asked why they plan to commit more to EM PE opportunities, 58% of survey respondents indicated they are seeking greater diversification in their PE portfolio, up from 38% of respondents in the 2014 survey. In contrast, half of respondents in the 2015 survey planned to increase their commitments because they expected PE to outperform other EM investment opportunities, but the corresponding proportion in this year’s survey was just 32%. The latter trend may reflect the strong performance of EM public equities in 2017.
• Reflecting the strong growth in fundraising for EM venture capital and EM private credit documented in EMPEA’s Industry Statistics, the percentage of LPs planning to begin or expand investing via funds employing these strategies has increased over the last two years.
• While the majority of commercial investors** take environmental and social impact into account when making investment decisions, most do not maintain a dedicated allocation to impact investing opportunities.
• Southeast Asia has regained the top spot in EMPEA’s market attractiveness rankings, followed by India and China, forming a top three exclusively comprising markets in Emerging Asia. Despite its relative stability at the top of the rankings, Southeast Asia has failed to attract more capital than many markets ranked much lower, though LPs are likely accessing the region through commitments to pan-Asia funds.

* Excludes institutions with EM-only mandates, including DFIs, EM-focused funds of funds and others legally mandated to invest in emerging markets.
** Excludes DFIs, government agencies and LPs exclusively focused on impact investment opportunities.