Canadian Investment Review

10 Reasons to Consider Investing in Africa: Forum Part 3

Written by Caroline Cakebread on Monday, May 3rd, 2010 at 9:43 pm

typical south african mountain road in summerAfter two days spent learning about Africa, I’ve seen a lot of myths about the continent challenged and dispelled. Based on what I learned during my two days spent at the Forum, I have compiled the following list (thanks to one of the organizers, Lisa Lambie of Cordiant Capital).

Here are 10 reasons why Canadian plan sponsors should consider investing in Africa:

1. Africa is a continent of 53 countries, not just a single nation

2. African countries are rated higher than BRIC countries in ease of doing
business and corporate governance (e.g. Ghana, Tanzania, Tunisia,
Rwanda)

3. Africa has 36% of the world’s emerging market countries, 30% of the
mineral resources, and will have 20% of the global population by 2050
yet receives only 4% of foreign direct investment (FDI).

4. 86% of Sub Sahara Africa is projected to grow at 5-12% in 2010.

5. Africa on a relative basis was more resilient than most other Emerging
countries (not to mention Developing countries) in the recent global
downturn.

6. Africa has generated the highest rate of return for international
investors on private FDI for 06-07 (confirmed) and likely 08 as well.

7. Africa has had the highest rate in growth of private FDI to emerging
markets since 2004 and this is expected to increase by 22% in 2010

8. Africa has $980bn in infrastructure requirements over the next 10
years (including power and telecom).

9. Other growth sectors are fast moving consumer goods, agribusiness,
financial services, and the small to medium enterprise market.

10. Canadians know Africa better than they think – while Canada is the #1
international investor in the Africa mining industry those engineering
and infrastructure skills can be translated to meet the continent’s
infrastructure needs and opportunities.

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