The Future of Growth is in Infrastructure in Emerging Markets

At Wellspring Capital Group, we have dedicated ourselves to ensuring that our partners see the best possible return on their investments. Our meticulous research and selection process for choosing where and when to invest is the main driver behind this success. The key is knowing where to look for opportunities and when to take the best advantage of them. Naturally, those private equity firms with a keen eye for high-growth investment areas will be able to generate the best advance leads, the most secure development projects, and the most measurable return on any investment. We believe that the greatest potential lies in infrastructure.

A mere glance at a GDP map of the world from recent years shows the potential of capital investment not only in newly-industrialized markets, but also in economies normally described as “developing.” These latter economies have not yet even reached the threshold that would allow political scientists to place them in the higher bracket, which generally recognizes stability in governmental institutions and a solid middle class just as much as it takes actual GDP growth rates into account.

Nonetheless, all of the top twenty representatives in the 2017 list of countries and dependent territories with the highest GDP growth rate are outside of the developed world. Even volatile conflict zones such as Libya and Iraq have been able to break into the upper echelons, though their futures are in the shadows due to conflicts that are just as political as they are economic. Naturally, China and India make the top twenty, but so also do relative dark horse candidates such as Burkina Faso and Côte d’Ivoire. Asia is well represented on this list, particularly Southeast Asia. Vietnam has seen a dramatic rise in its manufacturing sector since the reforms of the 1980s which encouraged private ownership of industries across the board. Other countries in the region, particularly Laos, Cambodia, Malaysia, and the Philippines, are not far behind.

The drivers of this growth are market reforms, a proliferation of free trade agreements, and an increase in a consumer middle class (this is particularly true in China). It is undoubtedly aided by the on-the-ground observation that growth can be nearly exponential when you launch from a relatively low starting position where you once lacked capital, endured a dearth of privately-owned industry, or had a disinclination to engage with potential trading partners. When all of that changes, and the floodgates are opened to wealth and industry, the economy will flourish, but only to the degree that it can be aided and abetted by dependable infrastructure. This, in turn, brings about more growth and even greater investment opportunities.

In other words, private equity investors have the chance to see their investments in infrastructure in emerging economies potentially generate wealth in every other sector in those economies. This pays in both the short-term and in the long-term. This is what we believe, and this is why we know that we will bring our partners the maximum return on their investments. Talk to us about your future, and we can show you just how fruitful it can be.