Annual review 2016: Fundraising in emerging markets

Private equity fundraising declined 9.3 percent in emerging markets to $35.4 billion in 2016, according to EMPEA, but the figures mask some impressive growth in China and Turkey.

China-focused vehicles raised $16.9 billion, surging 72 percent from 2015, while Turkey saw fundraising hit $824 million, up from $68 million in 2015.

Hony Capital Fund VIII, FountainVest China Capital Partners Fund III and Warburg Pincus China Fund were the biggest China funds to close in 2016, while Abraaj Turkey Fund I, Mediterra Capital Partners II and Taxim Capital Partners topped the Turkish closes.

While overall capital committed to private equity funds fell, EMPEA noted growth in what it terms “private equity-adjacent strategies” such as private credit and infrastructure.

“Investors’ options in emerging markets have grown more diverse,” says Jeff Schlapinski, director of research at EMPEA. “Many traditional SMEs in emerging markets are still starved of financing options, so growth equity can continue to have a big impact on these economies. However, the proliferation of different private capital strategies in emerging markets is good news for investors.”