The continent is growing very quickly, faster than China in some places, but there are dozens of very diverse countries with different outlooks. Are any of you investing in Africa? If so: how?
Maybe buy stock in telecoms and electric companies in countries that are just starting to develop?
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Mining in West and East Africa
Africa has been growing very quickly since 50 years. Truth is, African countries simply struggle at everything. You'd think a country as rich as South Africa would manage to ensure access to electricity and water to its citizens? Nope. There's corruption everywhere, governments are feckless. Infrastructure is a fucking joke. African countries are either trapped by their dependence to natural resources (oil and metals) or unable to develop their agricultural sector because 95% of farmers do subsistence farming and don't give a shit about increasing yields.
Africa needs to get its shit together
I feel bad reading this because it's so true :(
All of this is true and yet some random PC idiots who can't stomach opposite, facti-driven viewpoints are giving you MS
Smh
invade the country and talk shit about their political leaders, start a revolution, take the lead of the ship, restructure their political system and law, sell the weakest parts of your populations organs to china.
.
I got blasted high once and thought about the hunger and lack of heavy industry issues there and thought about controlling real estate off of the Mississippi river leading into the port of New Orleans to drive further agricultural and machinery exports to west Africa. Didn't really think it through. A lot of US exporters are already doing this, but need to get export credit insurance cuz obviously the African market can be fucked with shadiness for business.
Me too buddy, me too.
Realistically, there are probably a few hidden gems within South Africa, Nigeria, Kenya. Doing PE focused on these countries would actually be pretty interesting
There are some funds that do this - most of the ones in Africa itself are pretty small, but there are some larger ones elsewhere with African offices. Biggest Africa-focused fund I know is Helios, $1bn+ fund based in London with offices in Nigeria and Kenya. Carlyle used to have a $700M sub-Saharan sleeve that spun out into its own firm, and Abraaj had one that was $1bn or so before they collapsed - I think Actis bought their African assets
Trade Finance and Fintech both growing there.
Realistically most outside investors need political stability or an acceptable enough level of corruption to get business done.
Neither really exist at the same time anywhere on the continent. Will see what China’s belt and road initiatives do, but that raises its own issues going forward.
Yes this is a key point - great stuff identifying it. Institutional money is difficult to place where there is political instability and/or poor optics with regards to getting business done. While Africa is certainly growing it isn't exactly an ideal environment for private fund money to park itself.
If you're interested in the topic of institutional money in unstable places, you might be interested in the book "Red Notice" which is about a guy who make a killing investing in post-soviet Russia
*Leopold II of Belgium has entered the chat*
The problem with many African countries is not that they are poor but that investment in foreign countries and capitalism as a whole are fundamentally predicated on trust. You have to trust that your money and investment will not simply be seized by a corrupt government or some warlord in a highly unstable area. It's very easy to use the geographical territory of Africa as a strict resource farm and extraction site, as colonial powers did, but that's a pretty low value-add activity, and frankly contributed very little to the actual economic growth of European imperial powers.
The single best thing that could be done to increase the economic growth of African countries, in my opinion, is for developed countries to stop engaging in charity with no strings attached to the continent, and actually hold their governments and legal systems accountable to property rights and the enforcement of contracts. If they can't do this, nobody will want to touch them.
It's kind of like dealing with people, if you know someone who is dishonest and has all these "great investment ideas" that end up being scams, you're probably not going to want to ever do business with them, and they either learn from that and change their tune, or become a pariah.
You don't. In countries with high levels of corruption - esp with old economy businesses - the only ones who make money are sophisticated, well-connected locals. And most of that value creation happens in private markets, so getting access to it from the U.S. in public equities is highly unlikely. Also lots of value traps in such places, the juice isn't worth the squeeze.
There are easier ways to make a dollar, plenty of great businesses in the West (or ADRs for stuff in China / Southeast Asia / etc).
Typical oppressor mindset.
sovereign debt.
Be a mercenary and serve in the Congo or Nigeria.
Be an industrial-scale farmer in Rhodesia.
Poach high value animals in the bush of Tanzania
Traffic arms for communists in Angola
Mine diamond and gold in South Africa
Traffic people to Europe from North Africa
Steal historical artifacts from Egypt and sell them
Join a Somali pirate crew
All your ideas are 50 years old
As an American you will struggle to make money there. An established country like SA will ensure some ANC hack’s drug addled third cousin will own 49% of your venture without any guarantee against further confiscation, forced hiring of incompetents (there are often quotas for employees who grew up without plumbing), or rolling blackouts. If you go to more “developing” countries (what a euphemism for the Turd World) you cannot compete with the Chinese and middle men minorities (Israelis/Armenians/Indians etc). You will be arrested for violating the foreign corrupt practices act. You must violate it to be viable and operate a business. These other countries, all of which have ample networks in Africa, do not have an equivalent law because they understand it is a continent of graft and corruption with no state capacity. PM for more details.
100 years ago South Africa was the crown jewel of the British Empire, today it is a barely functional society. The majority of Sub-Saharan Africa is corrupt beyond belief, crimes against humanity are common (notice not even the "woke" crowd cares about Africa) and there are just too many people (their population is set to explode). Unless you plan to set up predatory loans (with a pound of flesh clause), or you're engaged in the arms trade, there is no money to be made in Africa.
After the shitshow South Africa is going through right now (which is held as the 'model' African country since the 'evil whites' were deposed), I wouldn't touch Africa with a stick
Entire continent is a steaming pile of shit
For the time being I just try to catch up with my buddy in Kenya when I can
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