Asia is expected to experience strong growth in private markets. The Deputy Prime Minister of Singapore believes the city-state is well-positioned to act as a key hub for the asset class in the region.

Since 2018, assets under management (AUM) within private markets have grown 20 percent per annum to reach $13.1 trillion as of mid-2023, according to McKinsey’s «Global Private Markets Review 2024». And by 2027, S&P Global projects that this amount will exceed $18 trillion, driven by private credit, real assets and secondary markets.

In a speech at the «SuperReturn Asia Conference», Gan Kim Yong, Singapore’s Deputy Prime Minister, highlighted Asia’s positive outlook in private markets and the role that the city-state can play.

«Private capital has the opportunity to write the next chapter of Asia’s growth story, and contribute towards uplifting the lives of generations to come,» said Gan, who is also the Minister for Trade and Industry as well as chairman of the Monetary Authority of Singapore. «We have a strong ecosystem here in Singapore, which can help the private markets community tap on and unlock Asia’s potential.»

Regional Growth Drivers

In terms of the recipients of private market investments in Asia, Gan highlighted three areas.

Firstly, this includes channeling more private capital to support the growth of micro, small and medium enterprises. Secondly, is the role of private capital for green and transition finance needs. Thirdly, is to drive expansion in the digital economy.

Hub Ambitions

Gan also named three ways that Singapore could achieve its ambitions to become a hub for intermediating capital flows and investment opportunities.

The first is to maintain a conducive environment for businesses. The second is to offer various fund structures and investment platforms to reduce costs and improve efficiency, such as the 2020 launch of the Variable Capital Company (VCC) structure. Thirdly is the deepening of investors and asset owners across large institutions, sovereign wealth funds, family offices and high net worth individuals.

«Even as geopolitical tensions between the US and China cloud the investment climate, Asia – and in particular, ASEAN – offers significant potential for growth,» Gan added. «Singapore, at the heart of Southeast Asia, offers the ideal platform for private market players to make inroads into the region.»