US private equity firm Colony Latam Partners, part of Colony Capital, has revealed plans to invest US$5 billion in four Latin American countries, a sign that investors are optimistic of the region’s growth.
Mexico will receive half of the investment, with Colombia, Chile, and Peru likely to share the remaining amount, according to media reports.
Colony Latam is focusing on sectors such as real estate, clean energy, and credit lending, according to Reuters, citing a senior executive at the PE firm.
Stock and bond markets are trading low across the region, with investors unclear about the potential policy changes by recently formed governments in Brazil and Mexico.
Brazil’s President Jair Bolsonaro and Mexico’s President Andres Manuel Lopez Obrador have yet to enthuse investors will their plans, with the latter having canceled the construction of a new, US$14 billion airport in Mexico City, in addition to putting aside plans aimed at further liberalizing the energy sector.
The US congress has also yet to ratify the new free trade agreement between Mexico, the US and Canada, the USMCA.
However, Mexico’s manufacturing industry has shown rapid growth in recent months, and which is benefiting from the ongoing trade war between the US and China.