In the course of the last several decades, Latin America has been faced with high inflation and an instability in their currency. Fiscal reform is hindered in Brazil by corruption scandals. The economic and energy sectors of Venezuela are driving the people from the country. There is enough economic progress in certain Latam countries to draw investors but the challenge is a lack of liquidity. Highland Capital Management believes Argentina may be different due to the higher education of the population, the third biggest economy in Latin America and the natural resources. The growth of the country has been hampered due to political turmoil but the economic recovery is promising. Read more about Highland Capital at prnewswire.com.
Argentina has been guided by Peronist policies since the 1960’s. Mauricio Macri is the current President of the country and is leading Argentina’s center right political party. He has been trying to reverse the populist policies since he was elected in December of 2015. He has raised the energy tariffs and lifted currency controls to bring Argentina into the global capital markets. These changes began in April of 2016 when Argentina entered these markets. The country had been absent since 2001. Argentina raised $16.5 billion while numerous developed countries were trading at a negative yield.
Argentina began attracting global interest. This led to the realization by the government that foreign capital was necessary. One of the earliest investors in Argentina was Highland Capital Management. Their involvement preceded Macri’s election because they believed there had to be an improvement in the economic conditions. Highland Capital has built an investment strategy based the economic recovery being driven by Macri. The firm additionally invested in defaulted Argentine debt. This investment had favorable results. The agreement in 2016 between the lenders and the country led the way to Argentina being able to reenter the international markets. By this time, Highland Capital Management had already implemented their strategy for economic recovery.
James Dondero began exploring Argentina as a potential investment in 2012. He began expanding their team due to his confidence in the economic policies of Macri. The company’s investment efforts were localized in Argentina in 2016. This made Highland Capital Management one of the very first investors. Visit highlandcap.com to know more.
SWball June 5, 2018
Posted In: Fund Management