The continent is now growing much more rapidly than the OECD nations. It may well be on the cusp of a reversal of fortunes.
Most international businesses are still not very aware of Africa’s investment opportunities. Information costs are high: Africa is fragmented into many different countries, and even in aggregate the continent is a fairly small economy. For several decades, investor ignorance did not matter: with few exceptions Africa’s economies were too badly run for there to be many opportunities for firms of integrity. But there has been a sea change—Africa is on the move. There will be ups and downs, but investors from the countries of the Organisation for Economic Co-operation and Development (OECD) who remain set in their ways may be missing a giant business opportunity if they fail to pay attention to the changes afoot.
The situation in Africa quietly began to change during the period 1995–2005. Profound macroeconomic reforms tamed inflation and opened economies to international trade. More patchily, the regulatory environment facing international business also improved. Public ratings, such as the World Bank’s Doing Business surveys, enabled African governments to benchmark their performance and began to put pressure on those that were recalcitrant. As the global commodity boom built to its 2008 crescendo, many African countries were well positioned to harness the spike in their export revenues for growth beyond the resource extraction sector itself.
That upturn in national growth rates was mirrored in the increased profitability of companies operating in Africa. Indeed, three distinct sources of data indicate that returns on investment are higher there than in other regions. One was a comprehensive study of the publicly traded companies operating in Africa for the period 2002–07, mostly in the manufacturing and services sectors. It found that these companies’ average return on capital was around two-thirds higher than that of comparable companies in China, India, Indonesia, and Vietnam. Another source, on the foreign direct investment of US companies, showed that they were getting a higher return on their African investments than on those in other regions. Finally, analysis of a series of surveys of several thousand manufacturing firms around the developing world found that, at the margin, capital investment had a higher return in Africa.1
This was the scene in the years leading up to the global crisis. Although its origins had nothing to do with the continent, the crisis did not bypass Africa. Its effect was to collapse commodity prices—for example, the price of oil initially tumbled by more than $100 a barrel. More subtly, the international appetite for risk collapsed, and since Africa is still generally viewed as the riskiest region, investors got scared; for example, international banks curtailed letters of credit to African exporters far more drastically than to those in other regions.
These effects were severe. However, with a few exceptions—inevitable in a region with so many countries—Africa weathered the economic storms well. Led by its two largest economies, South Africa and Nigeria, most countries had built prudent fiscal positions: in a remarkable break with its past, Nigeria had freed itself from debt and built up over $70 billion of foreign-exchange reserves. Further, the adverse impact of the crisis through commodity prices lasted less than a year for Africa. Globally, commodity prices rapidly bounced back and seem to have stabilized around levels markedly higher than those in the decades before the boom, underwritten by growing Asian economies and their corresponding need for commodities.
Revenues from commodity exports have been augmented not just by high prices but also by the resource discoveries that high prices have triggered. Yet the recent discoveries are merely the beginning: the scale of what is likely to happen is not widely appreciated. As I show in The Plundered Planet, Africa is the last major region on Earth that remains largely unexplored. In the long-explored countries of the OECD, the average square kilometer of territory still has beneath it around $114,000 of known subsoil assets, despite two centuries of intense extraction. In contrast, the average square kilometer of sub-Saharan Africa has a mere $23,000 of known sub-soil assets. It is highly unlikely that this massive difference is due to a corresponding difference in what is actually there. Rather, the difference in known assets is likely to indicate an offsetting difference in what is awaiting discovery.
It is reasonable to suppose that what is actually under the soil in the average square kilometer of Africa is at least as valuable as what is known still to be available in the OECD. An implication is that once these untapped resources have been discovered, Africa’s commodity exports will be around five times their present level. In turn, this has three profound implications. One is that many of the countries in which resources are discovered will be those that currently are not significant resource exporters: the economic map of Africa will change quite drastically as new opportunities open. A second is that such a radically higher level of commodity exports across the region will support correspondingly larger economies. The final implication is that in the process of getting to this much higher level, Africa will have a prolonged phase of rapid growth.
Now for the reality check. During the commodity booms of the 1970s, Africa also had a wave of resource discoveries. With a few exceptions, most notably Botswana, these opportunities were not harnessed for transformative growth. Indeed, the more common experience was an ugly and costly political contest for control of the revenues. If history repeats itself, the forthcoming much larger wave of resource discoveries in Africa will leave a legacy of scarred landscapes and scarred lives.
Yet the contrast between Nigeria’s dysfunctional management of its first oil boom of 1973–83 and its brilliant management of the second boom of 2003–08 cautions against the gloomy cynicism that until recently bedeviled investor thinking about Africa. The road to economic transformation is undoubtedly likely to be a bumpy one, but many African societies have learned both from their own histories and from the prosperity of other once-poor countries. Unlike the externally dictated structural-adjustment programs of the 1980s, the key struggles over economic policy will be internal to African societies. They will not all be won, but nor will they all be lost: some societies will decisively adopt progrowth economic strategies.
To date, Africa has lacked the spectacular regional role models of economic success that so benefited Asia. But it is now starting to get them. Even in Rwanda, a landlocked, crowded country lacking in natural resources, a leadership committed to economic transformation has been able to sustain a growth rate of 10 percent. In some of the countries with more favorable fundamentals, even faster growth rates will be sustained. Such successes will have a profound influence on the neighbors, just as occurred in Asia.
As in Asia, I doubt that there will be a close correspondence between the struggles for democracy and the struggles for economic transformation. The struggles for democracy do indeed have an important economic dimension: many African rulers have accumulated excessive personal power and abused it to sacrifice the common good of national prosperity for narrow sectional self-interest. But more recently, some African leaders, such as President Museveni of Uganda,President Kagame of Rwanda, and Prime Minister Meles of Ethiopia, have built strong credentials for a commitment to the economic transformation of their societies while being somewhat hesitant democrats. Some of Africa’s coming economic successes will be in societies that have won the struggle for accountable democratic government. But others will be in societies in which autocratic leaders have become ambitious for national goals rather than merely for power and privilege; expect some African repetitions of Malaysia’s experience.
Africa’s economic potential extends well beyond commodity exporting. Per capita GDP in China is already above the global average, so its days as the low-wage factory of the world are limited. Africa will soon be the last remaining major low-wage region. It has an enormous coastline, more proximate to both European and North American markets than Asia is. Over the past three decades, offshoring shifted labor-intensive manufacturing from the OECD countries to Asia. In the next decade, expect the same process to begin shifting these activities from Asia to Africa. Contrary to fears that the “Dutch disease”2 must inevitably make nonresource exports uncompetitive, the Asian examples of Malaysia and Indonesia have demonstrated that successful exporting of natural resources can be entirely compatible with successful exporting of light manufactures.
From African independence, beginning in the early 1960s, until around the turn of the millennium, the OECD prospered while Africa stagnated. A legacy of this divergent experience is that OECD investors are skeptical of Africa’s future. Their skepticism is not shared by the new entrants to international investment, who missed this sorry phase of African economic performance. It may be that Africans will use their history to learn from it, while OECD investors end up being trapped by it. Africa may be on the cusp of a reversal of fortunes. Indeed, Africa is now growing markedly more rapidly than the OECD. A future of continued rapidly rising prosperity for the OECD looks less assured than it did before the global crisis, whereas several decades of high growth look to be quite a likely scenario for Africa. At present, the typical investment portfolio has massive exposure to the OECD countries and negligible exposure to Africa. This looks unlikely to be appropriate for the coming decades.
1 Paul Collier and Jean-Louis Warnholz, “Now’s the time to invest in Africa,” in “20 breakthrough ideas for 2009,” Harvard Business Review, January 2009.
2 During the 1960s, the export of large quantities of newly discovered natural gas from the Netherlands led to an increase in the value of its currency and therefore made other Dutch exports less competitive in international markets.
About the Author
Paul Collier is a professor of economics at Oxford University. His new book, The Plundered Planet: Why We Must — and How We Can — Manage Nature for Global Prosperity, was published by Oxford University Press in April 2010.
Saturday, September 24, 2011
Sunday, September 18, 2011
Profitable And Easy Ways To Invest In Africa
With the global economy showing signs of a possible recovery, investors have been re-evaluating their portfolios and have started adding risk in order to seek better returns. These include emerging markets investments, which have surged over the past few months. The broad-based iShares MSCI Emerging Markets Index (NYSE:EEM) is up nearly 30% year to date. Most investors focus on traditional emerging markets or the BRIC economies, but there are other opportunities in Asia, Eastern Europe and the Middle East. Right now, one of the more intriguing areas for investment is Africa. (Please see The Frontier Awaits for more emerging markets ideas.)
Inside AfricaThere are several reasons for investing in Africa. The region has experienced some growth, averaging 6% since 2004. Africa is also home to one of the planet's largest concentrations of natural resources. Nearly 40% of earth's total gold reserves and 30% of its mineral deposits lie within Africa's borders. These resources have been flying off the shelf, with exports to nations like China increasing nearly 40% since early 2002. In addition, several nations via trade pacts have favorable terms. Ghana's exports qualify for duty-free access in the U.S. and European Union markets. These resource dollars are beginning to see their way back into African infrastructure and telecommunications, thus increasing growth even further.
However, one of the main reasons why Africa is becoming a viable growth investment vehicle is due to increasingly politically stable nations. In the '70s and '80s there were failing governments throughout Africa, including Ghana, Uganda, Tanzania and Nigeria. Since then, Nigeria has cleaned up its balance sheet, enacted real financial laws and redesigned its banking system from the ground up. South Africa has been tackling its 23.5% unemployment rate, the highest on the planet, by enacting far-reaching multi-year public works projects. The nation hopes to half this number by 2014. Rwanda has made telecommunications a top priority, setting up fiber optics networks in its capital of Kigali. The African landscape is changing due to improving education, healthcare, justice systems and building new infrastructure. (Investing overseas begins with a determination of the risk of the country's investment climate, read Evaluating Country Risk For International Investing.)
How to InvestWith the recent proliferation of exchange-traded products, Africa is not missed, as there are several low-cost options for long term investors in the space. Volatility is the name of the game for these ETFs, as this an "emerging" emerging market and only investors with a long-term timeline, perhaps with a decade to spare, should be investing.
As the largest economy on the continent, South Africa gets most of the investment pie. It's no surprise that the iShares MSCI South Africa Index (NYSE:EZA) is also the largest ETF in the space with nearly half a billion dollars in assets. While the ETF focuses just on South Africa, it does include many of the continent's largest players, including oil and chemical giant Sasol (NYSE:SSL) and miner AngloGold Ashanti (NYSE:AU) via their Johannesburg exchange listings. The fund is up an impressive 210.64% since its inception in 2003, and counts materials as its top sector holdings. Expenses run a relatively cheap 0.63%.
You can also play the South African recovery via its currency. The WisdomTree Dreyfus South African Rand ETF (AMEX:SZR) seeks to replicate both money market rates in South Africa and changes in value of the South African rand relative to the U.S. dollar. Currently, the fund yields nearly 6% and has returned 12% since its inception in mid-2008.
IN PICTURES: 7 Tips On Buying A Home In A Down Market
Broad Choice
While South Africa makes up 31% of Van Eck's Market Vectors Africa ETF (AMEX:AFK), the remaining holdings are spread over various African nations including Nigeria, Kenya, Morocco and Zambia. Based on the Dow Jones Africa Titans 50 Index (DJAFK) the ETF includes holdings in developed and undeveloped markets, giving investors a broader choice for African investment. While the fund hasn't truly captured the imagination of investors yet, with only $29 million in assets under management, it does show promise. Volume is light, with a three-month average of 24,000 shares daily. Investors with a truly long timeline may want to give this one a go.
Bottom Line
With more and more political stability developing on the continent, Africa seems poised for growth. Though there are some risks in investing here, longer-term focused investors may want to think about placing some money in this area. The preceding ETFs make it easy to invest in Africa.
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Why you should invest your money in Africa
Where ever there are challanges opportunities exist.
As an African decent, my ultimate dream obviously is to see the condition of Africans in Africa improves. I always dream that one day the countries of this land would unite. And together they’ll bring once again enlightenment to the world like the Black Egyptians in Africa once did. Africa, the land of all people, the second largest continent with nine hundred million people is composed of 54 different countries.
As an American, can you imagine United State of America being split into 52 separate countries, how unpractical would it be for us to trade? Conflict among states would have become an issue; war would have become inevitable just like we have seen with different nations in Africa. A united nation of Africa is the only solution. As long as Africa is divided between different countries, she will always be a prostitute for empires to pimp.
Africa is the richest continent in natural resources and yet most of her people are among the poorest in the world. How that came to be is an issue that most economist preferred not to elaborate on. Those that do either lied abut it or they simply won't tell or don’t know the truth. There is only a handful of economist who would tell you the truth about why Africans are poor but they're not famous. Anyhow those who knows the details would rather avoid talking about the issue.
However, some countries have been looking to built new factories or invest in local enterprise which is a good way to help Africa. The method that’s not helpful to African nations is when these countries are offered help in the form of charity. That money never got to be distributed or invested within the economy of the country for which it was offered. The best way to help Africa, is to invest in it infrastructure by building roads, schools and factories.
We live in a time where the world economy is connected and are accessible via the World Wide Web. Once our economy becomes fully connected, it will become laughable for us to even think of ourselves as separate government. We have already seen, how the recession can effects the world economy, what will happen next is a joint venture between some of the biggest corporations in the world. This is why some companies are now exploiting the opportunities that are currently available in Africa.
These companies understand that if they want to continue growing, they must expand their operation to the world poorest populations by formulating products that the poor market can afford. The ability to increase sales by expanding an organization’s activities or operations to a different region is the outcome of a growth strategy.This strategy can be manipulated to understand how to market products to populations where the income levels of the individuals are substantially lesser than most average countries.
This strategy will have to incorporate an intense integrated low-cost differentiation strategy so that it become effective. What I'm conveying to you here, is that corporations that choose to inverst in those poor areas in Africa must produce at a price that is advantageous to them so that they make a profit.
I presume, since the incomes of the population in some countries in Africa are that low, corporations might as well consider building their factories there. The purpose of doing that is to raise the income of the very population they want to sell their product to. They should do that by providing the Africans with jobs while subsequently developing a market for prosperity and growth to take flight. It is very much like the paradox, killing two birds with one stone. To fully understand Africa, one must have some comprehension of the opportunities that are currently open to investors. To consider these opportunities, one must also have some understanding of Africans in Africa.
Some people say that Africa is a dark country, has an AIDS epidemic, high poverty rate, etc. These are things that some people say about Africa. Unfortunately, those who are ignorant of Africa will not benefit from the opportunities that are currently available in it. George Campbell, the geographer once said “The only thing that is dark of Africa is our ignorance of it.” I now understand his reasoning, since most people seems to think of Africa as a country.
For one to say that there are no opportunities in Africa is to say that there is no opportunity in gamble. It’s true that there are challenges in Africa, but wherever there are challenges, opportunities exist. Investors can lose or make money in Africa just like any stock investment, the bottom line is that investing in Africa is a low risk invesment depending on how one looks at it.
In addition, for investors to invest in Africa, they must understand that corporations follow the law of a ruling government, but they are not controlled by them. They're there to protect the interest of the corporations and to protect the platform in which business is conducted. If people can begin to understand that, they would come to realize that the world is not truly being governed by countries, but instead by corporations. It is only then potential investors can understand why investing in Africa is a good investment. Until then some investors will continue to neglect the opportunity to develop markets in the countries of Africa.
A threat can also be described as when a company fails to take advantage on a currently available opportunity. A company that fails to act on an opportunity because they have miscalculated the future outcome of their investment, has left the door open for their competitors to initiate a threat. This is why any company who has invested in the opportunities that Africa has to offer will have established a customer base that will not be comparable to new arrival competitors. Since it’s not possible for companies to invest in all the opportunities that Africa has to offer, every opportunity they missed or leaves pending, they’re leaving themselves exposed to a potential threat.
On Wednesday, October 24, 2007 Goldman Sachs released a report that predicted that by the year 2020, Nigeria will be among the top ten world economies. The report also indicated that CNBC has Launched CNBC Africa, a 24 hrs news network. My first respond to this was why would they do that? They have implemented a growth strategy by moving part of their business to a different region. Then I realized why - they have done it because they have access to information that projects certain outcome that most of us regular folks just don’t have.
I believe the incentive for initiating this news network in Africa reveals that they expect investment to fallow. If you take a look at the report, you’ll notice that inflation has decreased from double digits to single in countries like Zambia, Egypt and Nigeria. Looking at this report, one can also noticed that there are other opportunities that are available for many companies in America to initiate an investment.
For example, Tanzania needs investors to help established standards for organic produce, that’s an opportunity. New roads need to be developing, that’s opportunity, and energy needs opportunity. 10% of Nigeria’s population has bank account, that’s opportunity, needs for automobiles equal opportunity. These opportunities that are currently available to companies all over the world; it is up to you the executive to decide whether you see opportunity or challenges.
What this report demonstrates is that a threat doesn’t necessarily have to occur in the present tense; sometime the most severe threat lies in the unpredicted future. Therefore, this is why it’s extremely important for companies to follow trends like return on investment, gross domestic product, public needs and population expansion. This way, companies will be able to envision where the next economic boom will take place, so that they can take appropriate measures to exploit every opportunity they get.
Although companies should pay attention to these future threats, the present threats are just as significant if not taken seriously. However, the current threat to some companies is the inability to quickly deploy their dynamic capabilities which are helpful for introducing new products to be sold in the market. This inability will then open new doors for new entrepreneurs to initiate a threat.
The ability for other entrepreneurs to enter the industry is always a threat to any company, regardless of its size. The last threat I will mentioned is the major stakeholders, which are the stockholders, their ability to redraw from their investment is a huge threat that all organization faced. Now, if you sorely think in terms of threat, you’ll never notice an opportunity. As a company, it’s always important to manage risk by weighing opportunities with weaknesses & threat. It is the only time; you’ll know whether or not an opportunity is advantageous.
Howell, Lafayette. “Procter & Gamble looks to poor markets for growth.”[Mongabay] Available http://news.mongabay.com/2007/0715-wsj.html, July 15, 2007
Kambo, Frederick. “Addicted to the hustle.” [Goldman Sachs] Availablehttp://freddkambo.blogspot.com/2007/10/invest-in-africa-get-rich-repeat.html, Oct 24, 2007
be advise the respond from the first anonymous at the above link is me.
Thursday, September 15, 2011
12 Reasons to Invest in Africa
Over the past decade, South Africa outperformed the MSCI Emerging Markets Index
August 26, 2010Forget the BRIC countries of Brazil, Russia, India, and China. Larry Seruma, chief investment officer of Nile Capital Management, says many retail investors are missing a tremendous opportunity for growth in Africa. Seruma manages the Nile Pan Africa fund, the first actively managed, U.S.-based mutual fund to focus exclusively on Africa. He recently released a report, which can be seen here, that explains hisinvestment firm's reasons for investing in the continent.
Seruma says more investors will begin to look outside of developed markets like the United States for growth, because those markets aren't expected to grow as fast as they have in the past. "It's only much more recently you're beginning to see these huge disparities coalesce," he says. "The U.S. is going to have very low investment opportunities going forward."
[See U.S. News's Mutual Fund Score to find the best investments for you.]
Investing in Africa involves plenty of risks. The biggest, Seruma says, is liquidity. "Liquidity is really the ability to trade frequently," he says. "When you want to get out of a position, it's not easy to get out of a position." Executing trades can be difficult because some African stockmarkets aren't as transparent and not as much trading takes place compared with, say, the S&P 500. There are other concerns, including the threat of government and corporate corruption. Many African countries have become functioning democracies, however, according to Seruma.
There are a number of other funds that give investors access to Africa and other "frontier" markets, which are also sometimes called pre-emerging markets. Templeton Frontier Markets and iShares MSCI South Africa Index ETF are two examples. Out of the 53 countries in Africa, Seruma's fund currently invests in 14, which together account for about 90 percent of Africa's overall market capitalization. Here are Seruma's reasons for investing in Africa.
'Ground-floor opportunity.' Seruma says many investors have already missed what he calls a "ground-floor opportunity" in Africa. For the decade ending Dec. 31, 2009, an African composite index made up of eight countries, including South Africa, Nigeria, and Egypt, returned about 14 percent annualized. South Africa alone returned an average of 13 percent per year over that period. Compare that with the MSCI Emerging Markets Index, which returned about 7 percent annualized, or the S&P 500, which lost about 3 percent over the same time period. He compares the risk versus return ratio in Africa today with emerging markets like China, India, and Brazil in the late 1900s—meaning that investors who enter a new high-growth market first reap the highest returns over time because they're willing to take on more risk.
[See The Opportunity in Africa.]
Low correlation. Correlation is a measure of how investments perform in relation to each other. A low correlation, for example, means that two securities will frequently move in opposite directions. According to Seruma's research, from January 2002 through June 2009, an African composite index of eight countries had a correlation of 0.59 with the S&P 500, 0.66 with the MSCI EAFE Index (which measures developed markets outside of North America), and 0.60 with the MSCI Emerging Markets Index. That means that 59 percent of the time, the returns of the African index differed from those of the S&P 500. Investors can use correlation statistics to find out how to better diversify their portfolios. "The African markets have a very low correlation with domestic or other emerging markets, so [you have a] good opportunity to actually reduce risk in the overall portfolio," he says. Diversifying your portfolio among uncorrelated assets can help offset big losses.
Strong growth expected. According to projections from the World Bank, nine of the 15 countries in the world with the highest rate of five-year economic growth are in Africa. Seruma estimates that Africa is likely to grow by 4.7 percent over the next five years. Economists expect much slower growth in places like the United States and U.K. over the next few years. "It's a pretty huge growth differential," he says.
Profitable companies. There are a number of well-known companies that are based in Africa, including South African Breweries (a subsidiary of SABMiller) and telecom company MTN. Africa's total stock market capitalization now exceeds $1 trillion. A recent study by two economists, Paul Collier and Jean-Louis Warnholz, found that from 2002 to 2007, the average annual return on capital of African companies was 65 percent to 70 percent higher than that of comparable companies in China, India, Indonesia, and Vietnam. That means the African companies were more profitable.
[See 7 Great Dividend Funds.]
Demand for commodities. "It's mainly driven by [the] BRICs," Seruma says. "As they industrialize, they're going to be demanding more and more of these commodities." For instance, 10 percent of the world's oil reserves and 40 percent of the world's proven gold reserves are found in Africa, according to Seruma.
Increasingly less violent. According to Freedom House, 63 percent of Africa's population now lives in countries designated "free or partially free." Compare that with Asia, which has a score of 66 percent. Seruma says most African countries now have functioning democracies. "It's a very different picture from what it was 20 years ago, and that has increased investment," he says.
China's involvement in the region. Seruma singles out China because many Chinese companies—some of which are backed by the government—have made significant investments in Africa. "They are really taking a long-term view about investing in Africa," he says. The governments of countries like China have realized that they're going to need resources from the African continent to fund their growth and consumption in the future, Seruma says.
Infrastructure spending. Countries are no longer coming to Africa solely to extract resources. They're beginning to stay and help make important infrastructure improvements in the continent, Seruma says. "The old story of investment in Africa was 'let us get the natural resources out of the ground and immediately ship it out,'" Seruma says. "Now it's changing. Not only do they go to Africa and make an investment in Africa, but they're also making the additional development projects." For instance, diamond giant De Beers recently signed a deal to mine diamonds in Botswana, including a commitment to build a diamond sorting facility.
Low debt. Concerns about sovereign debt—the debt that governments owe—has made headlines in Europe. Countries like Greece, Portugal, and most recently, Ireland have seen their debt downgraded by ratings agencies like Standard & Poor's. The United States also faces a huge budget deficit. Seruma says he believes that the United States will see five or six more years of low interest rates, which will lead many investors to look to different regions of the world for higher yield. "The capital being pushed out of the developed markets is going to benefit Africa," he says. "We believe this time around, there is some sustainability in terms of capital flows." Many African countries don't have the same worries. Seruma cites Nigeria, which has a debt-to-GDP ratio of only 18 percent, compared with countries like Greece and Japan whose debt-to-GDP ratio is more than 100 percent.
Growing investment from abroad. Seruma also cites a United Nations Conference on Trade and Development report, which shows that capital flows to Africa are higher than three of the four BRIC countries. Africa is ahead of Brazil, India, and Russia. It's second only to China.
Attractive valuations. Seruma believes that many African countries are currently trading at attractive valuations. He says the average price-to-earnings ratio for African companies is about 8 to 9 percent compared with the S&P 500, which has an average P/E ratio of about 15 or 16 percent. "There's a huge valuation differential that is not explained by the risk," he says.
Young demographics. Compared with other regions of the world, Africa has a much younger median age, which means African governments aren't as burdened by elderly populations and pension plans. It also means that Africa has a young, vibrant workforce, Seruma says. Africa's most populous nation is Nigeria, which Seruma accounts for about a quarter of Africa's total population. Nigeria's median age is 19 years old. Compare that with 37 in the United States, 40 in the U.K., and 45 in Japan.
Mikhail Prokhorov’s Renaissance Group Plans Elaborate Investments in Africa
Posted By Pauline Sung on September 12th, 2011
Russia’s Renaissance Group – jointly owned by Russian billionaire Mikhail Prokhorov and New Zealand’s Stephen Jennings – is planning elaborate investment plans in Africa, which would fortify the company’s foothold across the continent and strengthen its potential economic renaissance.
The pan-emerging markets investment bank has plans to build a 6,400-acre city in the Democratic Republic of Congo in addition to its $5 billion Tatu City that the company is currently building in Kenya.
The plans signify a major strategic boost in Africa and is further evidence of an increasing number of Russian firms that are shifting their focus more on the country’s economic growth and emerging urban middle class rather than its extractive industries.
The group also revealed plans for a new urban center after securing the land just outside of Lubumbashi, the country’s second-largest city, as well as considering similar projects in Ghana, Nigeria, Senegal, and Rwanda.
Arnold Meyer, Renaissance Partners’ managing director in charge of their real estate in Africa, explained, “The West has peaked in terms of economic growth and the new markets are in Africa, and the main drivers of this growth in Africa are going to be cities.”
Although it remains undisclosed as to exactly how much the group’s Lubumbashi project will cost, it is said to be more than double the size of Tatu City, the $5 billion, 2,500-acre center that the firm is building from scratch outside of Nairobi. Tatu City will function as in independent municipality and is reported to house62,000 residents, a stadium, technology park, hospital, shops, office towers, and playgrounds.
Our Haute 100 list details the accomplishments of the most influential people in each of our markets. To see the entire Haute 100 New York list, click here.
Tags: Africa, Africa News, Africa Real Estate, Arnold Meyer, big business, billionaires, Business, Congo,Democratic Republic of Congo, Ghana, Haute 100, Haute 100 New York, Haute 100 New York Update, Haute 100 Update, Haute Living New York, investments, Investors, kenya, Large Scale Real Estate, Lubumbashi, Mikhail Prokhorov, Nairobi, New York, New York City, New Zealand, Nigeria, NYC, Pauline Sung, Real Estate,Renaissance Partners, russia, Russia News, Rwanda, Senegal, Stephen Jennings, Tatu City, The Renaissance Group
The pan-emerging markets investment bank has plans to build a 6,400-acre city in the Democratic Republic of Congo in addition to its $5 billion Tatu City that the company is currently building in Kenya.
The plans signify a major strategic boost in Africa and is further evidence of an increasing number of Russian firms that are shifting their focus more on the country’s economic growth and emerging urban middle class rather than its extractive industries.
The group also revealed plans for a new urban center after securing the land just outside of Lubumbashi, the country’s second-largest city, as well as considering similar projects in Ghana, Nigeria, Senegal, and Rwanda.
Arnold Meyer, Renaissance Partners’ managing director in charge of their real estate in Africa, explained, “The West has peaked in terms of economic growth and the new markets are in Africa, and the main drivers of this growth in Africa are going to be cities.”
Although it remains undisclosed as to exactly how much the group’s Lubumbashi project will cost, it is said to be more than double the size of Tatu City, the $5 billion, 2,500-acre center that the firm is building from scratch outside of Nairobi. Tatu City will function as in independent municipality and is reported to house62,000 residents, a stadium, technology park, hospital, shops, office towers, and playgrounds.
Our Haute 100 list details the accomplishments of the most influential people in each of our markets. To see the entire Haute 100 New York list, click here.
Tags: Africa, Africa News, Africa Real Estate, Arnold Meyer, big business, billionaires, Business, Congo,Democratic Republic of Congo, Ghana, Haute 100, Haute 100 New York, Haute 100 New York Update, Haute 100 Update, Haute Living New York, investments, Investors, kenya, Large Scale Real Estate, Lubumbashi, Mikhail Prokhorov, Nairobi, New York, New York City, New Zealand, Nigeria, NYC, Pauline Sung, Real Estate,Renaissance Partners, russia, Russia News, Rwanda, Senegal, Stephen Jennings, Tatu City, The Renaissance Group
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