Some 40% of limited partners plan to increase new commitments to emerging markets private equity funds over the next two years, said the 12th annual EMPEA Global Limited Partners Survey, released Thursday.
It is a 6-percentage-point decrease from the 46% of survey respondents who indicated they would increase the dollar value of commitments to new emerging markets private equity funds in Emerging Markets Private Equity Association’s 2015 survey. In contrast, 22% of investors expect to decrease their commitments, up from 16% in last year’s survey.
Southeast Asia is the most attractive region for emerging markets private equity over the next 12 months, followed by India and sub-Saharan Africa.
Seventy percent of investors indicated that emerging markets private equity portfolio returns met or exceeded expectations, down from 75% in 2015. Even so, limited partners expect 2015 vintage emerging markets private equity funds to outperform developed markets private equity funds.
Investors’ top concerns for emerging markets private equity investments are slowing or negative gross domestic product growth in emerging markets and currency volatility.
In February and March, EMPEA surveyed 107 limited partners from 101 different institutions headquartered across 32 countries, collectively representing more than $1 trillion in reported global private equity assets.