Global deal activity experienced a significant setback, plunging by 24.1% year-on-year (YoY) from 47,692 to 36,176 deals during the initial eight months of 2023. This decline is attributed to the escalating geopolitical tensions and economic uncertainties. These factors cast a shadow over regions and key markets globally, impacting investor sentiment, according to GlobalData, a leading data and analytics company.

An analysis of GlobalData’s Financial Deals Database reveals that all the deal types under coverage (mergers & acquisitions (M&A), private equity (PE) and venture financing) witnessed YoY decline in volume during January-August 2023.

The number M&A deals declined by 17.6% while the volume of PE and venture financing deals declined by 25.9% and 32.2%, respectively.

Aurojyoti Bose, Lead Analyst at GlobalData, comments: “Deal-making sentiments have taken a dent amid the economic uncertainties, geopolitical tensions, and recession fears. And the trend is alike across all the regions and several key markets.”

North America continued to dominate the deals landscape even though the region witnessed 27.7% YoY decline in deals volume during January-August 2023. In terms of total deals volume, North America is followed by Europe, Asia-Pacific, Middle East and Africa and South and Central America regions.

Europe, Asia-Pacific, Middle East and Africa and South and Central America regions too witnessed YoY decline in deals volume by 19.9%, 21.5%, 26.7% and 29.8%, respectively, during the period.

The US, China, the UK, Canada, India, Japan, Germany, Australia, France, South Korea, Brazil and Israel reported YoY decline in deal activity by 29.2%, 16.1%, 15.8%, 13.6%, 30.2%, 16.4%, 21.3%, 21%, 15.2%, 33%, 31% and 33.5%, respectively.

Bose concludes: “In this climate of economic uncertainty and geopolitical tensions, the world of deal-making faces unprecedented challenges. Adaptability and strategic resilience will be paramount for investors seeking to thrive in these turbulent times.”