Now is the Time to Invest in Africa

Sunday, January 25, 2009 by David Castor
Victoria Falls, ZimbabweI love Africa.  I love it's rawness, beauty, the honesty of it's hardship.  It is opportunity that is constantly bashing heads with turmoil. 

There is an article in this month's Harvard Business Review entitled "Now's the Time to Invest in Africa".  For years I have been involved in building infrastructure in Africa and promoting opportunities for business growth within the continent.  In 2008 my firm handled deals in South Africa, Zimbabwe, Nigeria, Togo and Congo.  In 2009 I expect to handle deals in even more countires.  These transactions are anything from private placement offerings, to oil and real estate, to technology, to Internet, software licensing and SaaS licensing.  Just this weekend I worked with a client on a SaaS law matter for an Internet based technology start-up looking to launch in southern africa in mid-2009.

The gist of the article is that over the last few years trends have developed through Africa to present a prime investment climate.  This includes policital stability, international and economic policies, and business profits and growth.

Here are a few key stats from the article:
  • From 2002 to 2007 the average annual return on capital of African companies was 65% to 70% higher than that of comparable companies in China, India, Indonesia and Vietnam.
  • The median profit margin for 1,869 businesses survied in sub-Saharan Africa was 11% (based on World Bank data) - better than comparable figures for Asia and South America.
  • The IMF projects a 2009 growth rate of 6.3% for sub-Saharan Africa - and more than 8% for Uganda, Tanzania and Nigeria.
Americans as a whole need to rethink opportunities to invest in sub-Saharan Africa.  Not only is the investment climate prime, it is also a better long-term way to help the region achieve its promise by contributing much needed capital, business skills and global connections.

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See also:

International Business Law
Alerding Castor in Africa


Comments for Now is the Time to Invest in Africa

Thursday, April 16, 2009 by Joseph I.E.:
Market Statistics show that in the year 2008 the African Real Estate Sector performed stronger than the US Real Estate Sector, as strong as the European Real Estate Sector with only the Real Estate Sectors of Asia Pacific and the Middle East showing more strenght than the African Real Estate Sector. Whereas the African Real Estate sector was the least affected by the global economic crisis, which indicates that the African Real Estate is the most resilient of the worlds Real Estate Markets and is as profitable as any other market whrereas it is in its infancy and has enormous capacity for growth,growth is inhibited because many global Investors still errorneously perceive Africa as the dark continent to their own peril, because Africa is the new frontier for business. Any savy or prudent Real Estate Investor would know that this is the best time to enter the African Real Estate market, because demand is greater than supply in the sector, the statutory requirements placed on investors are liberal, tax considerations are very good and the continents economies are growing at a phenomenal rate.

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