Emerging markets are increasingly capturing private credit flows as investors seek higher yields and developed markets become saturated. Angola’s Atlantic coast fuel refinery exemplifies this trend, financed largely through private capital led by Gemcorp, highlighting a paradigm shift in global lending.
Key Takeaways:
- PIMCO has allocated ~$30B across 140 EM deals over 5 years and aims to raise annual lending by 30% to $10B in 2025.
- EM yields are 150–300 basis points higher than comparable developed market assets.
- Private credit in EM targets infrastructure, sovereign budgets, corporate projects, offering bespoke financing structures — from upfront fees to EBITDA warrants.
- Gemcorp’s portfolio spans oil refineries, wind farms, water sanitation, power transmission and now a $1B fund for mid-market Saudi companies.
- Investors highlight EM’s resilience to volatility compared with the developed market, where companies are “priced for perfection.”
“Emerging market companies have been doing this for a long time,” says Matt Christ, portfolio manager at Ninety One. “The U.S. market isn’t the benchmark anymore. Investors want yield and uncorrelated exposure.”