Conference Presentation, Panel, Fireside Chat
The State of Global Capital Markets and the Future of Finance | Asia Summit 2025
- Over the next 10 years, governments are expected to implement soft corporate governance targets to drive profitability and shareholder returns, creating a flywheel effect for investors.
- Global capital flows are anticipated to shift away from the US toward international markets, with emerging markets, the global ex-US, and Japan showing higher year-to-date gains than the US, a diversification trend expected to persist as corporate returns improve.
- Private markets are predicted to experience healthy expansion through the growth of semi-liquid segments and secondary transactions, though this sector faces the critical risk of liquidity constraints during periods of market stress.
- Deglobalization and US tariff initiatives are identified as the primary short-term risks, likely to spur local capital deployment, increase inflation sensitivity, and elevate the influence of the yield curve and Federal Reserve policy.
- The current deglobalization phase is viewed as only the first of a multi-stage process, potentially evolving into a "re-glocalization" where US companies maintain their ~40% foreign earnings exposure by identifying new trade partners.
- Emerging markets are expected to remain undervalued with potential for PE compression driven by productivity gains and activist pressure, creating opportunities to raise MSCI allocations from 20% to 50%.
- India's GDP is projected to reach between $6 trillion and $7 trillion in the future, supported by robust macroeconomic growth despite current valuation headwinds.
- The AI market is forecast to reach a size of $2 trillion to $3 trillion by 2030, a trajectory requiring massive investment that will likely result in only two or three long-term winners.
- Private market migration is creating a risk pool of 11 high-yield issuers that have exited public markets, posing a potential threat to financial stability when economic cycles turn.
- Future finance is expected to favor active portfolio management to generate alpha amidst geopolitical uncertainty, with an increasing availability of diverse asset classes and alternative investments like private credit and venture capital in Asia.
- Transition dynamics are expected to generate specific opportunities for active investors in Asia, even if some alternative investment returns currently lag behind public market performance.