We’ve all had time to settle back into our busy lives following the festivities of Christmas and Lunar New Year, and to digest the latest round of economic and investment forecasts, so what is the remainder of the 2023 calendar year going to look like for those seeking funding for major projects?
By Jacquelene Pearson*
Inflation, interest rates and geopolitical fragilities are the three main factors likely to influence the availability of funding for major projects across sectors and global markets for the remainder of 2023. The main suppliers of funding for major projects – traditional banking institutions, private equity sources and direct investors, each have a different opinion about how 2023 is shaping up.
The conventional banking sector – commercial, merchant and investment banks, appear to be the least optimistic and least flexible in terms of their outlook. They appear to be going through some sort of awakening about the fact they no longer have a monopoly on making funds available for major projects.
Deloitte’s 2023 Banking and Capital Markets Outlook, for instance, reports that “a new global economic order seems imminent. Banks globally can chart a path through the current fog of uncertainty to reposition for a brighter future.”
It goes on to report that: “commercial banks will likely face fierce competition to win a greater share of corporate clients’ wallets. They are demanding bespoke digital, data-rich solutions and tailored advice. These will likely require banks to excel at a new client service model.”
That new client service model is already in place in the private equity marketplace where it is possible to arrange funding for major projects without involving a traditional merchant or commercial bank.
Alternative funding sources, including Private Equity firms and funds, family offices, hedge funds, venture capital funds and even some cryptocurrency funds, are predicting a “bolder outlook” for 2023.
Data from Preqin shows there has been a global shift to private equity assets as opposed to public markets and this is particularly the case in Asia.
As central banks continue to raise official interest rates as their only weapon for combating inflation, the conventional banking sector and alternative asset providers are both cautioning that there may still be a global recession.
Recession talk may make it more difficult to secure funding in the months ahead and that is why it make sense to turn to a specialist funding arranger with a global presence, such as Acuity Funding.
We can help you to access funding from the major banks through to alternative sources such as private equity investors. We have access to most of the major funding sources across the globe.
Acuity Funding, with our membership of SWIFT and our global desk is also trusted by governments to facilitate cross-border funding arrangements.
While tech and health-care sectors actually benefited from the global pandemic, we expect to see a return to funding for other sectors which may have been neglected when government stimulus was being dolled out during the peak of COVID-19.
Fast-moving economic trends and continuing uncertainties related to the war in the Ukraine make it essential to have a funding arranger who can source the finance needed to make your 2023 projects successful.
Talk to Acuity Funding today to find out how we can help.
Jacquelene Pearson is Acuity Funding’s content editor
