At the recent Proximo Latin America 2025 conference in New York City, Freshfields partner Melissa Raciti-Knapp moderated the event’s opening plenary session, “The Macro View: Navigating Political and Economic Volatility.” The panel featured a distinguished group of senior leaders from Ardian, CIBC Capital Markets and Mexico Infrastructure Partners (MIP).
The session focused on how major capital providers are navigating political and economic volatility across Latin America's key infrastructure markets. The following key themes emerged from the discussion:
- A Long-Term Perspective. Panelists unanimously emphasized that a long-term investment horizon is essential to look past the region's inherent short-term political and economic volatility. Experienced investors focus on structural fundamentals—such as demographic growth and energy demand—rather than being deterred by temporary market noise or headline risk.
- On-the-Ground Expertise is a Prerequisite for Managing Risk. The discussion highlighted that a nuanced understanding of local regulatory frameworks and political dynamics is critical. Panelists from firms like MIP and Ardian noted that having deep local knowledge is the only effective way to navigate shifting regulations, manage permitting challenges, and anticipate the impact of government changes.
- The Structural Need for Private Capital is Growing. Panelists observed that persistent fiscal constraints on governments across the region, which often must prioritize social spending, have created a structural and growing need for private capital to develop critical infrastructure. This dynamic cements the private sector's role as an essential partner for economic growth.
- Geopolitics Directly Informs Investment Strategy. The conversation confirmed that macro-geopolitical factors—including US-Mexico relations, China’s evolving presence in the region, and the upcoming USMCA trade review—are no longer background context but direct inputs into capital allocation decisions. These dynamics create both identifiable risks and strategic opportunities that investors are actively modeling.
- An Active, Hands-On Investment Approach Delivers Value. The panelists stressed that passive financial ownership is insufficient in Latin America. Leading investors are taking an active asset management role by joining boards, building out management teams, and maintaining the operational flexibility to react to market shifts. This hands-on approach is viewed as essential for both risk mitigation and value creation.
Beyond the strategic principles discussed in the opening session, subsequent panels examined how these trends are crystallizing across key jurisdictions. Country-specific discussions repeatedly highlighted Chile for its institutional stability and readiness for the digital-energy convergence, and Mexico for its powerful nearshoring narrative. However, Mexico's digital infrastructure ambitions were seen as contingent on resolving grid constraints, a challenge shared by other markets. Brazil was frequently noted alongside both, possessing deep local currency markets and a strong position in the energy transition. Across all markets, an evolution toward shorter debt tenors and the expanding role of private credit were identified as key market-level trends.
For further information on project development and financing in Latin America, please contact Melissa Raciti-Knapp.
