African Entrepreneur

 


AFRICA: INVESTMENT DESTINATION
By Kizito Okechukwe


With Africa’s history, investing in Africa strikes many investors and Entrepreneurs as impractical and unwise. It is however true that much of Africa’s region has become poorer and gained popularity for lack of Education or healthcare, wars, corrupt or weak Governments and crippling debts. Most of the world’s poorest countries are in Africa. Its share of world exports has fallen drastically. With recent developments, some of these are histories as Africa is busy branding and positioning itself as a force in the world’s economy.

Dialoguing on the issue: Will Africa ever become a major investment destination, Nick Price, the manager of Fidelity’s Emerging Europe, Middle East and Africa fund voiced that Africa remains plagued by negative perceptions and it is the wars, famines and dirty diamonds that grab the headlines, not the spectacular growth. He goes on to conclude that the region remains one of the last unrecognised growth opportunities in the world with GDP averaging 5.3% over the last decade.

Recent studies and predictions by analysts have proved that more investors will begin to look outside of developed markets because those markets are not expected to grow as before, spotting and positioning Africa as the focal point. Among many reasons to invest in Africa, Ryan Hoover in one of his works succinctly captures and elaborates some reasons to invest in Africa. African stocks are cheap, Africa is where the growth is, and African markets have little to no correlation with Wall Street indexes, to help develop Africa’s capital markets. Lastly African markets are becoming more accessible than ever before.

Conducting business in 2011 pioneers a new measure showing how much business regulation has changed in 174 economies since 2005. Among the top 30 most improved economies, a third is from Sub-Saharan Africa. In the past five years, about 85% of the world’s economies have made it easier for local entrepreneurs to operate, through 1,511 improvements in business regulation. Globally doing business remains easiest in the high-income economies of the Organisation for Economic Co-operation and Development and most difficult in Sub-Saharan Africa and South Asia. But developing economies are increasingly active. In the past year, 66% reformed business regulation, up from 34% six years earlier. Optimists are still hell-bent that 2020 will see a dramatic acceleration in the shift of economic power eastwards and Sub-Saharan.

As  Africa continues to experience significant political and economic change which is improving the way we do business, investors, entrepreneurs and businesses are now  awake and alert to explore the business opportunities and potentials that’s been untapped in Africa’s markets.

 

 

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