April 13, 2011

Reflections From Institutional Investor’s Africa Conference

It is often difficult for opportunities in Africa to be understood by US investors. Notwithstanding the preponderance of data and evidence which suggests that Africa is on the cusp of a major developmental boom, it often seems challenging to explain that there is no better time to invest in Africa than today – except perhaps yesterday (or six months, or six years ago). Over the past decade, a composite of Africa’s markets have generated higher return than the S&P 500 and the MSCI Emerging Markets Index with less risk, as measured by volatility. It is sometimes hard to explain that the Africa of today is not what you might see in the headlines, or remember from years of sobering news reports. In fact, Africa is comprised of fifty-three unique nations, many of which have taken substantial and meaningful steps towards a prosperous future – and the numbers are there to prove it.

That being said, attending Institutional Investor’s conference on investing in Africa this week was a truly enjoyable way to spend the past two days. The conference brought together institutional and retail investors, business leaders, diplomats, and statesmen to discuss investing in Africa. All we can say is that we liked what we heard. Truth be told, we at Nile were not surprised by much of what was said. We have been saying all along that opportunities abound in Africa, not only in natural resources (which are plentiful), but in infrastructure, consumer goods, telecommunications, agriculture, financial services, housing, healthcare, and education, just to name a few. There are substantial returns to be made in Africa, and we hope to be able to help investors participate in the opportunity.

It would be possible to summarize what went on at the conference further, but we feel that many of the topics that were brought up deserve some real discussion. Therefore, we are going to hold you in suspense over the next few days, as we publish our thoughts on some of the biggest issues we believe were raised. Again, much of it may not surprise an investor who has been paying attention to Africa over the past few years, but it is likely to come as a shock to plenty of investors who have been looking elsewhere.

As a preview, here are the titles of our expected posts over the next week – stay tuned for more, and thanks again for all the delegates who made the event a good one – see you all next year!

1. The ‘Infrastructure Tinted Lens’
2. The Consumer Market – Just How Big is Big?
3. Moving Up the Value Chain
4. Risk management: Perception vs. Reality

For more information about investing in Africa, please contact Nile Capital Management at (646)367-2820 or info@nilecapital.com.

We know Africa - from Cairo to Capetown.

7 comments:

  1. I look forward the stream of posts! I felt a similar excitement when I attended the Harvard Africa Business Conference. It was refreshing to not have to convince people of the opportunities on the continent. I left the conference re-energized in pushing for the Metro Atlanta business community to engage business communities on the African continent.

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  2. Looking forward to your posts Bob. Not only are there many opportunities, thee are several ways to enter--as a portfolio investor, via private equity, or direct investment to name a few. And I agree with Kwame, the HBS conference was a good one.

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  3. Thanks Darnley. Of course, direct investment or PE is not always realistic for small investors with limited time or capital... which is one of the reasons why Nile chose to launch a mutual fund (www.nilefunds.com).

    Appreciate the support, as always. -MWA

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  4. Anyone got an interest in Zimbabwe specifically?

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  5. Thanks for this review, and I look forward to your updates as well.

    My practice specializes in risk-management for African investments, and in helping investors find financing with African specialists. The risk-v-reality gap for Africa is one of the most interesting in the investment field.

    It's good to see that this gap is being specifically targeted and discussed.

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  6. Geoff - can you clarify the question? From our perspective we look for opportunities in markets across the African continent, including Zimbabwe.

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