2023 is on track to be the worst year for US private equity and venture capital investments in mainland China for at least five years following a dramatic fall in deals in the first quarter of the year, according to a report by S&P Global.
Aggregate deal value in the first three months of the year tumbled by more than 86% from $3.03 billion in the same period in 2022 to just $400 million. The number of deals meanwhile, declined to 28 from 61 year over year.
First-quarter deal value and volume were also down compared to the fourth quarter of 2022.
The report cites Bain & Co’s “Asia-Pacific Private Equity Report 2023 as highlighting geopolitical tensions and the unknown impact of mainland China’s nearly three-year zero-Covid lockdown on manufacturing and domestic consumption as key reasons for the decline.
