Share of Voice vs. Share of Opportunity
Investors seeking outsized returns in the decade ahead need to look beyond the most-talked-about markets globally to those that will offer the greatest returns, a top private equity leader told a global industry gathering today.
“There’s a disconnect between markets that are taking up the lion’s share of the world’s attention and those with the most attractive investment opportunities,” said Stephen Murphy, Managing Director at Citadel Capital, the leading private equity firm in the Middle East and Africa with US$ 8.7 billion in investments under control in 15 industries spanning 14 countries. “Simply put, developed markets are winning far too much attention proportional to the opportunities there.
“By comparison, we see that emerging markets are home to outstanding private equity firms and very attractive investment opportunities, nowhere more so than in the frontier markets of Africa and the Middle East,” Murphy said in a keynote address to the Super Return Emerging Markets conference in Geneva, Switzerland.
“We face limited competition from other PE firms or stock markets. We operate in growing economies benefiting from dramatic increases in working age populations — indeed, Africa will be home to the world’s largest working age population by 2040. Moreover, we are benefiting in most instances from improved economic and political governance, and the businesses in which we invest usually enjoy some sort of natural competitive advantage.”
While recent unrest across the region will have an impact, Murphy noted, “it will not be long-lived. In the short-term, we expect to see impairment of the fundraising environment for a number of MENA economies, an increase in distressed investment opportunities and a slowdown in general economic growth,” said Mr. Murphy. “Democracy is generally good for business. We are hopeful that the political and economic reforms taking root in Egypt and Tunisia today will spread over the coming years to other important regional economies.”
This article was originally posted on Egypt - Sudan Business Communities
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