Investment opportunities in Africa are aplenty these days, including various sectors such as water, electricity, oil, waste management, and information technology. It is not surprising, then, that in recent years the region has attracted many international businesses eager to help Africa develop and become globally competitive. Given Africa’s recent resource boom, the continent is predicted to grow rapidly, and become more progressive.
Samuel Best-Koufie, Chairman of Global Merchant Capital Limited – a leader in the Private Finance market, is among the stalwarts of Africa’s infrastructure development projects. Best-Koufie argues the lack of a modern sustainable infrastructure is the largest hurdle the continent needs to overcome in order to compete on the world’s grandest economic stage.
According to a recent report from AllAfrica.com, consumer-facing industries in Africa are growing at a rapid rate, two to three times faster than in the developed world. The report further noted that the continent gained $55 billion worth of foreign direct investment in 2010, and the forecast for 2020 is a GDP of $2.6 trillion and $1.4 trillion in combined consumer spending.
During the 2009 global recession, Africa was also noted to be the only region besides Asia that experienced a positive growth of 2 percent. This growth rate soared in 2010 to 4.5 percent and 5 percent in 2011, according to the International Monetary Fund (IMF).
The period starting from 1995 to 2005 was considered to be very significant in the country’s economic history. During those years, the nation experienced macroeconomic reforms such as opening up to international trade, a rise in exports, and the establishment of public ratings that allowed African governments to measure their performance.
Through the years, as the country’s national growth rate soared and political situations stabilized, companies operating in Africa were enjoying better profits. Three data sources revealed that companies in the continent achieved a greater return on investment compared to other regions.
Extensive research from 2002 to 2007, conducted by Paul Collier and Jean-Louis Warnholz and published in the 2009 Harvard Business Review, has shown that publicly traded firms in Africa – notably, those in the manufacturing and services sectors – gained a return on capital two-thirds higher than those in China, India and Indonesia. The same study showed that U.S. companies with direct investments in Africa had a higher return on their investments compared to those in other regions.
Furthermore, an analysis of several studies also published in the Harvard Business Review, covering manufacturing firms in the developing world, revealed that they enjoyedhigher capital investment in Africa.
Even the world’s second poorest country, Ethiopia, is gaining momentum as it strives to modernize. Investors are providing capital towards investments in this African nation, not only to gain financially but also to ensure a social or environmental outcome. Commonly referred to as impact investment, this is considered to be an emerging investment style that aims to achieve both social and financial results for the country.
Vital Factors that Attract Investments
There are various reasons why Africa continues to attract foreign investors. These include the implementation of economic, political, and social reforms in the region that have led to a more favorable business climate. The development of important social and physical infrastructures and the rise in the number of well-educated workers who speak English are additional factors. Still, another reason is the improved spending power of Africans.
Knowledge@Wharton CEO Manu Chandaria affirmed Africa’s huge potential, citing that it is among the top 10 most important investment destinations at present. Six African nations- including Angola, Kenya, South Africa, and Nigeria – are included in the top 10 list of important investment destinations. Among the major reasons behind the rush of investments in the continent are its stable political climate and notable growth, expected to sustain at six percent in the coming years.
But as with any endeavor, investors targeting to get into Africa need to take risks and face challenges along the way. As Chandaria stressed, the initial phase of investment may be difficult, considering that the continent is a third world region without the comforts of the first world. As such, patience and being open to failure are required of international business organizations.
When asked, “Why is Africa a good place to invest right now?” Samuel Best-Koufie, head of Global Merchant Capital Limited, shared an important point regarding the great potential of the continent. “Africa is a good place to invest in right now because it is developing extremely quickly. Across the continent are developing cities, towns, villages, and places for people to live and work. It’s really an exciting time, but the country does not have access to the capital it needs to complete these projects as quickly as they need to,” he explained. “This is where a lot of these Western investors are coming in and helping these countries develop the infrastructure they need to be successful for a long time to come.”
Given its positive situation at present, foreign investors should really consider putting in their resources in African nations.
Sectors Worth Investing In
Currently, there is huge investment potential awaiting investors in various sectors. Specifically, these include the fields of agriculture, tourism, mining of solid materials, infrastructure, and consumer goods – particularly food, beverages, home care, and personal care products.
A golden opportunity exists in Africa’s uncultivated land, which makes up 60 percent of the world’s total. And as the global population rises, there arises a greater need to increase agricultural production.
Investors who come from the tourism sector can also tap the potential of several African nations. Kenya, Mauritius, Seychelles, and Tanzania are considered favorite tourist destinations, and businesses such as lodges, retreats, boat cruises, balloon flights and national park conservations have a great chance of survival there.
Mining of mineral deposits is another area worth investing in. In regions where the necessary technical knowledge and financial resources are lacking, foreign investors can venture into this area as well.
The infrastructure sector, on the other hand, requires huge funding in order for the continent to become globally competitive. Fortunately, various international companies, including Samuel Best-Koufie’s Global Merchant Capital Limited, are now actively taking part to provide financial services to the region.
The 2008 Africa Country Infrastructure Diagnostic Study of World Bank showed that the continent currently needs some $80 billion each year to meet its infrastructure needs. Hopefully, this positive investment trend will continue to ensure Africa’s development in the near future.
Investment opportunities in Africa are aplenty these days, including various sectors such as water, electricity, oil, waste management, and information technology. It is not surprising, then, that in recent years the region has attracted many international businesses eager to help Africa develop and become globally competitive. Given Africa’s recent resource boom, the continent is predicted to grow rapidly, and become more progressive.
Samuel Best-Koufie, Chairman of Global Merchant Capital Limited – a leader in the Private Finance market, is among the stalwarts of Africa’s infrastructure development projects. Best-Koufie argues the lack of a modern sustainable infrastructure is the largest hurdle the continent needs to overcome in order to compete on the world’s grandest economic stage.
According to a recent report from AllAfrica.com, consumer-facing industries in Africa are growing at a rapid rate, two to three times faster than in the developed world. The report further noted that the continent gained $55 billion worth of foreign direct investment in 2010, and the forecast for 2020 is a GDP of $2.6 trillion and $1.4 trillion in combined consumer spending.
During the 2009 global recession, Africa was also noted to be the only region besides Asia that experienced a positive growth of 2 percent. This growth rate soared in 2010 to 4.5 percent and 5 percent in 2011, according to the International Monetary Fund (IMF).
The period starting from 1995 to 2005 was considered to be very significant in the country’s economic history. During those years, the nation experienced macroeconomic reforms such as opening up to international trade, a rise in exports, and the establishment of public ratings that allowed African governments to measure their performance.
Through the years, as the country’s national growth rate soared and political situations stabilized, companies operating in Africa were enjoying better profits. Three data sources revealed that companies in the continent achieved a greater return on investment compared to other regions.
Extensive research from 2002 to 2007, conducted by Paul Collier and Jean-Louis Warnholz and published in the 2009 Harvard Business Review, has shown that publicly traded firms in Africa – notably, those in the manufacturing and services sectors – gained a return on capital two-thirds higher than those in China, India and Indonesia. The same study showed that U.S. companies with direct investments in Africa had a higher return on their investments compared to those in other regions.
Furthermore, an analysis of several studies also published in the Harvard Business Review, covering manufacturing firms in the developing world, revealed that they enjoyed higher capital investment in Africa.
Even the world’s second poorest country, Ethiopia, is gaining momentum as it strives to modernize. Investors are providing capital towards investments in this African nation, not only to gain financially but also to ensure a social or environmental outcome. Commonly referred to as impact investment, this is considered to be an emerging investment style that aims to achieve both social and financial results for the country.
Vital Factors that Attract Investments
There are various reasons why Africa continues to attract foreign investors. These include the implementation of economic, political, and social reforms in the region that have led to a more favorable business climate. The development of important social and physical infrastructures and the rise in the number of well-educated workers who speak English are additional factors. Still, another reason is the improved spending power of Africans.
Knowledge@Wharton CEO Manu Chandaria affirmed Africa’s huge potential, citing that it is among the top 10 most important investment destinations at present. Six African nations- including Angola, Kenya, South Africa, and Nigeria – are included in the top 10 list of important investment destinations. Among the major reasons behind the rush of investments in the continent are its stable political climate and notable growth, expected to sustain at six percent in the coming years.
But as with any endeavor, investors targeting to get into Africa need to take risks and face challenges along the way. As Chandaria stressed, the initial phase of investment may be difficult, considering that the continent is a third world region without the comforts of the first world. As such, patience and being open to failure are required of international business organizations.
When asked, “Why is Africa a good place to invest right now?” Samuel Best-Koufie, head of Global Merchant Capital Limited, shared an important point regarding the great potential of the continent. “Africa is a good place to invest in right now because it is developing extremely quickly. Across the continent are developing cities, towns, villages, and places for people to live and work. It’s really an exciting time, but the country does not have access to the capital it needs to complete these projects as quickly as they need to,” he explained. “This is where a lot of these Western investors are coming in and helping these countries develop the infrastructure they need to be successful for a long time to come.”
Given its positive situation at present, foreign investors should really consider putting in their resources in African nations.
Sectors Worth Investing In
Currently, there is huge investment potential awaiting investors in various sectors. Specifically, these include the fields of agriculture, tourism, mining of solid materials, infrastructure, and consumer goods – particularly food, beverages, home care, and personal care products.
A golden opportunity exists in Africa’s uncultivated land, which makes up 60 percent of the world’s total. And as the global population rises, there arises a greater need to increase agricultural production.
Investors who come from the tourism sector can also tap the potential of several African nations. Kenya, Mauritius, Seychelles, and Tanzania are considered favorite tourist destinations, and businesses such as lodges, retreats, boat cruises, balloon flights and national park conservations have a great chance of survival there.
Mining of mineral deposits is another area worth investing in. In regions where the necessary technical knowledge and financial resources are lacking, foreign investors can venture into this area as well.
The infrastructure sector, on the other hand, requires huge funding in order for the continent to become globally competitive. Fortunately, various international companies, including Samuel Best-Koufie’s Global Merchant Capital Limited, are now actively taking part to provide financial services to the region.
The 2008 Africa Country Infrastructure Diagnostic Study of World Bank showed that the continent currently needs some $80 billion each year to meet its infrastructure needs. Hopefully, this positive investment trend will continue to ensure Africa’s development in the near future.
Investment opportunities in Africa are aplenty these days, including various sectors such as water, electricity, oil, waste management, and information technology. It is not surprising, then, that in recent years the region has attracted many international businesses eager to help Africa develop and become globally competitive. Given Africa’s recent resource boom, the continent is predicted to grow rapidly, and become more progressive.
Samuel Best-Koufie, Chairman of Global Merchant Capital Limited – a leader in the Private Finance market, is among the stalwarts of Africa’s infrastructure development projects. Best-Koufie argues the lack of a modern sustainable infrastructure is the largest hurdle the continent needs to overcome in order to compete on the world’s grandest economic stage.
According to a recent report from AllAfrica.com, consumer-facing industries in Africa are growing at a rapid rate, two to three times faster than in the developed world. The report further noted that the continent gained $55 billion worth of foreign direct investment in 2010, and the forecast for 2020 is a GDP of $2.6 trillion and $1.4 trillion in combined consumer spending.
During the 2009 global recession, Africa was also noted to be the only region besides Asia that experienced a positive growth of 2 percent. This growth rate soared in 2010 to 4.5 percent and 5 percent in 2011, according to the International Monetary Fund (IMF).
The period starting from 1995 to 2005 was considered to be very significant in the country’s economic history. During those years, the nation experienced macroeconomic reforms such as opening up to international trade, a rise in exports, and the establishment of public ratings that allowed African governments to measure their performance.
Through the years, as the country’s national growth rate soared and political situations stabilized, companies operating in Africa were enjoying better profits. Three data sources revealed that companies in the continent achieved a greater return on investment compared to other regions.
Extensive research from 2002 to 2007, conducted by Paul Collier and Jean-Louis Warnholz and published in the 2009 Harvard Business Review, has shown that publicly traded firms in Africa – notably, those in the manufacturing and services sectors – gained a return on capital two-thirds higher than those in China, India and Indonesia. The same study showed that U.S. companies with direct investments in Africa had a higher return on their investments compared to those in other regions.
Furthermore, an analysis of several studies also published in the Harvard Business Review, covering manufacturing firms in the developing world, revealed that they enjoyed higher capital investment in Africa.
Even the world’s second poorest country, Ethiopia, is gaining momentum as it strives to modernize. Investors are providing capital towards investments in this African nation, not only to gain financially but also to ensure a social or environmental outcome. Commonly referred to as impact investment, this is considered to be an emerging investment style that aims to achieve both social and financial results for the country.
Vital Factors that Attract Investments
There are various reasons why Africa continues to attract foreign investors. These include the implementation of economic, political, and social reforms in the region that have led to a more favorable business climate. The development of important social and physical infrastructures and the rise in the number of well-educated workers who speak English are additional factors. Still, another reason is the improved spending power of Africans.
Knowledge@Wharton CEO Manu Chandaria affirmed Africa’s huge potential, citing that it is among the top 10 most important investment destinations at present. Six African nations- including Angola, Kenya, South Africa, and Nigeria – are included in the top 10 list of important investment destinations. Among the major reasons behind the rush of investments in the continent are its stable political climate and notable growth, expected to sustain at six percent in the coming years.
But as with any endeavor, investors targeting to get into Africa need to take risks and face challenges along the way. As Chandaria stressed, the initial phase of investment may be difficult, considering that the continent is a third world region without the comforts of the first world. As such, patience and being open to failure are required of international business organizations.
When asked, “Why is Africa a good place to invest right now?” Samuel Best-Koufie, head of Global Merchant Capital Limited, shared an important point regarding the great potential of the continent. “Africa is a good place to invest in right now because it is developing extremely quickly. Across the continent are developing cities, towns, villages, and places for people to live and work. It’s really an exciting time, but the country does not have access to the capital it needs to complete these projects as quickly as they need to,” he explained. “This is where a lot of these Western investors are coming in and helping these countries develop the infrastructure they need to be successful for a long time to come.”
Given its positive situation at present, foreign investors should really consider putting in their resources in African nations.
Sectors Worth Investing In
Currently, there is huge investment potential awaiting investors in various sectors. Specifically, these include the fields of agriculture, tourism, mining of solid materials, infrastructure, and consumer goods – particularly food, beverages, home care, and personal care products.
A golden opportunity exists in Africa’s uncultivated land, which makes up 60 percent of the world’s total. And as the global population rises, there arises a greater need to increase agricultural production.
Investors who come from the tourism sector can also tap the potential of several African nations. Kenya, Mauritius, Seychelles, and Tanzania are considered favorite tourist destinations, and businesses such as lodges, retreats, boat cruises, balloon flights and national park conservations have a great chance of survival there.
Mining of mineral deposits is another area worth investing in. In regions where the necessary technical knowledge and financial resources are lacking, foreign investors can venture into this area as well.
The infrastructure sector, on the other hand, requires huge funding in order for the continent to become globally competitive. Fortunately, various international companies, including Samuel Best-Koufie’s Global Merchant Capital Limited, are now actively taking part to provide financial services to the region.
The 2008 Africa Country Infrastructure Diagnostic Study of World Bank showed that the continent currently needs some $80 billion each year to meet its infrastructure needs. Hopefully, this positive investment trend will continue to ensure Africa’s development in the near future.
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Originally posted on August 4, 2014 @ 9:30 am