A case for short term investments in emerging/frontier markets

Please correct any economic concepts i've misunderstood in this post, I'm by no means an authority on this subject..just a college sophomore who feels as though i've stumbled on to something and would love to gain insights from all the experts here.

Having spent some time interning in equity and macro research focused on emerging markets (specifically sub-saharan Africa) I'm well aware that general sentiment across many foreign investors is that these markets are far too underdeveloped and will not reach a suitable level of development for at least two decades. However, working closely with investors with a larger risk appetite, I have come to see that there is immense short term potential in sub-saharan Africa with risks much lower than you might expect.

Take Nigeria, for example. The Nigerian government often runs a large budget deficit which it finances by issuing treasury bills twice a month (see: http://www.reuters.com/article/nigeria-bills-idUSL...). Discount rates for 90 day T-bills are between 12-14%. There is no default risk as these bonds are denominated in local currency (so in the absolute worst case the central bank can print more money). Investors' major exposure is of course fx related (but I imagine this can be hedged using fx futures, though investors we work with don't even go this far.)The exchange rate is about $1 = NGN 365 with relatively little volatility due to the central bank's interference in the currency markets. Considering this, investors can easily make 10% (adjusted for fx gain/loss) with extremely low risk. As such, this sort of investment seems like low hanging fruit to me (and apparently many emerging market investors).

Inb4 "Very little risk? Nigeria? Are you out of your mind?"

Despite news reports of a sick president, terrorist attacks and the like, the nigerian government is more stable than you would think - especially in the time frame of these treasury bills. With all this in mind why the morbid fear of such investments (aside from a prince running off with your money of course) ?

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