Practical analysis for investment professionals
21 November 2013

Fear of Investing in Africa Is Losing You Money

Africa has its challenges, from corruption to political risk, yet the continent has changed and will continue to evolve. And once investors consider the impressive facts about the growth and transformation of Africa’s economies, their fear and pessimism about investing there should dissipate. Those were the key messages that emerged from a panel discussion entitled Emerging Markets — Spotlight on Africa, moderated by Bloomberg Television’s Manus Cranny, at the Sixth Annual CFA Institute European Investment Conference in London.

Speaking first, Charles Robertson, global chief economist at Renaissance Capital, highlighted the change theme. His view is that GDP growth knows no barriers, be they climate or ethnicity. Nobody expected the growth that China and India have experienced, and he argued that, in similar fashion, Africa’s GDP will cover a lot of distance in catching up with the rest of the world. Ten African countries have achieved at least 7% annual growth since 2000, he noted, enough to double GDP in about a decade. This growth is the result of public and private sector debt, increasing foreign direct investment, favorable demographics, rising education, and reforms that have made doing business easier.

Continue reading on the European Investment Conference blog

About the Author(s)
Usman Hayat, CFA

Usman Hayat, CFA, writes about sustainable, responsible, and impact investing and Islamic finance. He is the lead author of "Environmental, Social, and Governance Issues in Investing: A Guide for Investment Professionals;" the literature review, "Islamic Finance: Ethics, Concepts, Practice;" and the research report "Sustainable, Responsible, and Impact Investing and Islamic Finance: Similarities and Differences." He is interested in online learning and has directed three e-courses for CFA Institute: "ESG-100," "Islamic Finance Quiz," and "Residual Income Equity Valuation." The other topics he writes about are macroeconomics and behavioral finance. He has experience working in securities regulation and as an independent consultant. His qualifications include the CFA charter, the FRM designation, an MBA, and an MA in development economics. He has served as a content director at CFA Institute. He is a former executive director at the Securities and Exchange Commission of Pakistan (SECP) and former CEO of the Audit Oversight Board (Pakistan). His personal interests include reading and hiking.

1 thought on “Fear of Investing in Africa Is Losing You Money”

  1. Mbuanza says:

    Homework must be done on Africa – but that is true about all investments. The growth story itself is more than factual now.

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