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Africa optimism rising
When some of the most influential figures in emerging markets finance spoke to a group of Reuters editors, they were asked about top picks for growth beyond the so-called BRIC countries of Brazil, Russia, India and China.
One continent came up again and again – Africa – and one country in particular – Nigeria. Goldman Sachs global head of economic research, Jim O’Neill, highlighted the improvement in the growth-environment index of Africa’s giant over the past decade.
“If it were to show the same increase in its growth-environment score over the next decade, many investors will look back and say why the hell didn’t I invest in Nigeria,” said O’Neill, who coined the term BRICs.
You can read the full story here.
Recent interest in Africa has been buoyed by the World Cup while a series of reports have highlighted its prospects beyond the global crisis. There was a recent McKinsey study and Fitch has come out with an improved outlook for sub-Saharan Africa.
There is certainly plenty of optimism outside the continent. Will it be fully realised this time around?
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The Optimism is overwhelming and the Catalyst for this spike has been self evidently the World Cup. There has been an egregious Perception Gap when it has come to the Continent and it has been embedded for a very long time. The Move from that Position to Neutral is no small Potato.
Confidence is a very tricky thing to measure scientifically but I believe it is absolutely Key. That on a continent such as ours there is an Amplification Effect a Feedback Loop. We might just be about to tap into that Virtuous Circle and Sweet Spot.
That has the potential of being a Game Changer.
Aly-Khan Satchu
http://www.rich.co.ke
I’m a U.S. investor building a company in West Africa. I’m optimistic. Challenge is executing on the ground.
Interesting update,i think the future of the black continent is so bright
We building an ecosystem to connect africans globally
http://www.sysafrica.com
I love this continent and believe in it
I am going to be wealthy. I am working on some deals with the friends and family of government workers in Nigeria. They’ll send me millions of dollars and I get to keep half. Rich, I tell you!
Prospects lie wherever there are PEOPLE .. Africa’s plight is self inflicted but not irredeemable. Any forward looking person should know that the opportunities that abound are overwhleming. This is not about some get rich issue. It’s of concrete investments whose payoff may be slow but guaranteed. But business instincts only follow the trtend .. It magnifies a positive and excercabates the negative. Financial Advisors should begin to let their clients know of the innately immense benefits of taking positions in African economies.
Jett – well done for you. I hope you reap very handsome returns on your investments. I think you will. There are challenges everywhere. I think when one understands the “game” you become a better player. Challenges abound everywhere. Make the right connections and success cannot evade you.
Mabakaii – EXCELLENT take. Any financial advisor worthy of his job MUST educate himself on all sectors of the sub Saharan African economy and take a few positions. I am, and I cannot wait to awaken everyday to learn and understand more about what Im beginning to regard as the next Frontier. China and Asia are much spoken of in terms of the leading economies in this century. Watch OUT for Africa. The whole world is going to depend on the Sub Saharan African consumer market, mining industry, and agro industry for up to 25% and all within the next 2 decades.
The last part of this little article asks: ‘There is certainly plenty of optimism outside the continent. Will it be fully realised this time around?’ Answer: No it won’t.
Sure there’s more optimism after the world cup. Sure Africa is immensely rich in people, potential and recourses. But what has changed? Massive systemic Government corruption and incompetence is still rife and the west are still interested only in what they can get OUT of the continent, and rightly so. No, Africa needs to get it’s own house in order before it will even start to look like a significant player in the world economy and that prospect is at this point not even a remote possibility.
I am optimistic that I’ll one day win the lottery, not likely to happen is it?
For Africa to be succesful in attracting foreign investors it will be important to create environment that is conducive for economic investment,firstly all countries must respect the african peer review programme especiall its good intention on good administration and governance,secondly invest in education and health,thirdly physical infrastructre development and finally our leaders must accept that the people shall govern
There’s an improving trend for Africa and investor confidence, but a single man’s bid to overturn an election result hurts not just his own country and compatriots, but the whole continent. See how the markets will react to Cote D’Ivoire crisis, http://www.africancapitalmarketsnews.com /784/institutions-react-to-cote-d%E2%80 %99ivoire-crisis/
The opportunity in the Sub-Sahara Africa especially Nigeria is Enormous, Communications, oil and gas, retail, ppp infrastructures projects, distribution, tourism, fast moving consumer goods, food production etc. With all these opportunities are few challenges. We’re a $7m investment firm out of NY. “Fritz wells group”, we decided to try Nigeria over a year ago, its tough but it’s worth it. Research, research, research. And Patient. You have to be on ground to see it
Africa has a lot of potential economic indicators in the form of human and natural resources. But some of the factors holding back this sleeping giant are:
1) The lack of vision by the leaders. Most of the leaders are self centered and do not think of the collective interest of the whole. Hence the race to amass wealth while in office.
2)Lack of infrastructures: Until transportation systems are well maintained and brought up to standard internal trade among countries in the continent will be insignificant.Africa countries should increase comence among themselves.
3)External factors: Multinationals have too much sway in the production of Africa’s natural resources. That’s is OK, but many leaders are influenced with bribes by these multinational leading to insignificant result in revenue for the countries. A case in point; Nigeria indicting former US vice president Dick Cheney and former company to court for corrupting government officials.
4)Last but not least are the Deals: Africa countries are gaining next to nothing from business deals with these multinationals. African countries should be able to command up to 30% revenue from mining and other operations so as to generate enough income for development. Ghana in 2008 produced about 89 tons of gold.At the current price of gold, there should be substantial revenue from gold. But no. Ghana only gets about 3% of the profit. That I call travesty of fair trade.
In summation Africa is too fragmented for any positive strength, economically or politically. Until there is a United Africa, we will still be having unrest in the continent.
Thesage, you couldn’t have summarized this better. You are on point on everyone of the factors you listed. The challenge now is – how do we create the next generation of African Leaders that will recognize these problems and deliver the continent.
I believe Africa to prosper is when it start to have self love , we have so much self hate which manifest itself through leaders not wanting to relinquish power, civil wars , corruption and all the other stuff..we need to love ourselves.. despite the world looking at us as not equals..
The BRIC or BRICS (with South Africa) is quite an interesting development in world economics and world politics
1. The world must realize that it is one place, only devided by man’s greed hiding behinding self determination.
2. Thank you so much to the USA, Britain, Japan and other Europian countries for dominating the world in the past. I think their dominance has given all of us an opportunity to think and think, the BRICS is an outcome of that.
3. What the world needs now is a creed of selfless leaders, who would look beyond personal gains and honestly work for making this world a better place. Remember Michael Jackson’s words.
To Sabelo.
The 2 part of you post is veri subjective and too far from reality.Based on modern history we can say that ther is no reasons for thankgiving for thise countrys.You point of vue is a little naive.
The problem is long-term government stability and anti-business socialistic leaders. They seem to buy into the old Soviet Socialism.
Africa has the natural resources for growth, but Africans have not proved good at developing those resources. China is getting in the game, providing capable managers at African mines, while the Africans provide labor. While this arrangement grows African economies, it is not the sort of thing that whites can participate in without being denounced as imperialists.
According to the United Nations and human rights organizations around the globe, multinational corporations have made billions in (name your currency) in profits in Africa, but the African people themselves are left with little to show for giving up their natural resources, unless of course you count the generous amount of toxic waste that’s been dumped into their environment. The entire world is becoming a plutocracy.
It is a big mistake, as many commentators often do, to paint the whole of Africa with the same brush. Whilst you may say most of Africa share certain similarities, it will be a serious error of judgement to assume they are the same, especially in making a business decisions.