In this special edition episode of the Global Investment Leaders podcast, Gávea Investimentos Founder Arminio Fraga brings his unique background in academia, public policy and investment management for a discussion about the global economy and the opportunities and challenges that exist for investors. During the episode, Fraga shares insights from his extensive background before founding Gávea, which includes roles as President of the Central Bank of Brazil, Managing Director of Soros Fund Management and positions with Salomon Brothers and Garantia Investment Bank. Fraga has also taught as an adjunct professor at the School of International Affairs at Columbia University and the Wharton School, among others.

From the perspective of Gávea, a leading independent alternative asset management firm focused on emerging markets, Fraga shares his thoughts on the geopolitical environment challenging investors across the globe. While Fraga jokes that economists are paid to worry, the concerns topping his list include 40 years of low declining interest rates that have risen materially, very high inflation in the US and Europe and massive supply-side problems in Russia, Ukraine and China. Further, Fraga notes that the increasing rise in authoritarian leadership globally underscores the importance of understanding that when investing in emerging markets, the norms and regulations under which we operate in the western world only apply to approximately one-third of the globe.

However, Fraga finds that many reasons remain to be optimistic. For example, in emerging markets like Brazil, in which Gávea specializes, people every day are taking the opportunity to learn, improve and build companies that serve a need, which in turn creates investment opportunities. For Gávea, this means identifying businesses led by outstanding leaders who are looking for support in the areas of strategy, finance, risk, people and value creation. One example is ReGreen, a company that aims to restore 1 million hectares of Atlantic Forest and Amazon rainforest in Brazil, in which Gávea invested. “Our goals are substantial, but I don’t think I’ve ever been as excited about an investment,” Fraga shares, noting the tailwinds of regulation and a world increasingly focused on ESG.

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