Best Ideas of 2011: Invest in Africa

Best Ideas of 2011: Invest in Africa

Authored by: Rebecca Regan-Sachs

The almighty U.S. dollar is in the doldrums.¬†Asia’s growth has slowed. Europe’s embroiled in economic disaster. So what’s a global investor to do?

A recent cover story in The Economist spotlighted a potential answer. In Africa today, years of small changes are now adding up to potentially big payoffs for the savvy investor. This past year alone saw important gains in good governance and economic growth on the continent, while economic woes continued apace overseas. One of the best ideas of 2011 to accrue serious currency can be summarized simply: invest in Africa.

Certainly, major drawbacks exist. Infrastructure and electricity are still unreliable in much of the region, and pervasive corruption limits growth and innovation. But the key to investing is to catch undervalued assets before they take off – and if economic forecasts are correct, Africa will experience the largest growth of any other continent in the next decade.

Take the latest World Bank “Doing Business” (DB) findings. In the past survey year, a record number of sub-Saharan African (SSA) countries –¬†78 percent – improved their business regulatory environment. Eighteen countries improved enough to climb in the DB rankings from the previous year.

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