Sovereign wealth funds face tougher dealmaking environment as protectionism grows

LONDON (July 16): Sovereign investors are facing a tougher environment for dealmaking as rising protectionism threatens to curb inward investment and stunt trade, suggesting private market activity may have plateaued, a co-author of a report out on Monday said.

In recent years sovereign wealth funds (SWFs) have ramped up their exposure to real assets, snapping up iconic skyscrapers in London and Manhattan, luxury hotels and multi-year concessions for Australian ports.

The aim was to tap the "illiquidity premium" on offer for investors able to tie up capital for longer as an alternative to low-yielding government bonds.

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