Tag Archives: frontier markets

Emerging Foreign Investment Flows May Double: Time to Invest?

Money out of a plastic pipes    This could be the time to invest in emerging market countries, of which South Africa is one. (Some also mention Nigeria as an emerging market country, but it is still arguably a frontier market one.)

“Foreign investment in emerging markets should double this year to $550 billion compared to 2015, despite local selling pressure and Brexit, according to the Institute For International Finance.”

“In its July report,  the group explained its reasoning behind why emerging markets will remain attractive to foreign investors. Here are eight important assumptions from the institute’s lengthy report, and comments from the release on profitability and country exposure:

  1. Investors want yield and that is a key driver for emerging market capital flows.
  2. Brexit could intensify appetite for emerging market growth.
  3. EM economic growth is in a gradual cyclical recovery.
  4. The U.S. Fed is unlikely to produce hawkish policy surprises, which would draw investors to U.S. yields from EM yields.
  5. China is likely to avoid a disorderly movement in its currency, the renminbi, in order to keep short-term growth in line with its target, despite the resulting slowness in structural reform and high-and-rising debt levels.
  6. Brexit is likely to have a muted impact on emerging markets except those in Eastern Europe.
  7. Stabilization of commodity prices should benefit EMs, with oil prices to remain around the $45-50 per barrel in the third quarter.
  8. EM valuations are attractive.”

Many South African-based multinationals are already in and/or expanding into other parts of Africa.  This could be a good time to look at them. We’ll keep you posted!

8 Reasons Emerging Foreign Investment Flows May Double: http://blogs.barrons.com/emergingmarketsdaily/2016/07/14/8-reasons-emerging-foreign-investment-flows-may-double/2/

Could You Be Missing Out on Investing in Francophone Africa?

FRENCH EQUATORIAL AFRICA - CIRCA 1946: a stamp printed in French Equatorial Africa shows Young Bacongo Woman, circa 1946

FRENCH EQUATORIAL AFRICA – CIRCA 1946: a stamp printed in French Equatorial Africa shows Young Bacongo Woman, circa 1946

Many investors in anglophone countries don’t seem to understand, or are afraid of, investing opportunities in francophone Africa.  Although this article from South Africa discusses it from their perspective and from a total business perspective (as opposed to a stock investor perspective), the theme here is relevant.

“Francophone Africa remains a bridge too far for most risk-averse South African investors. Only a handful of SA’s sizeable corporates have made the journey to countries in this complex but promising region, kept at bay by the invisible barriers of language and foreign business culture.”

We here at the African Investment Report remain “on the hunt” for great stocks in all of the countries of Africa, whether the culture is anglophone, french, lusophone or “whatever”.  The important thing is to find great investments that you can add to your portfolio.

Also see:

“Orange Could Be A Great Stock to Buy and a Great Play on African Growth”

“Standard Bank’s Expansion Into French Africa Teaches Us About Africa’s Investment Growth Potential”

“How to Invest in French Africa From Home”

Risk-averse Companies Missing Out in Francophone Africa: http://www.bdlive.co.za/opinion/columnists/2016/07/04/risk-averse-companies-missing-out-in-francophone-africa

Time to Ring the Bell for Nigerian Stocks?

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The Hon. Yakubu Dogara, Speaker of the Nigerian House of Representatives, rang the closing bell for the Nigerian Stock Exchange (NSE) this past Friday. Leaders in the Nigerian legislature are pushing for reforms and innovations for the exchange.

“The Hon. Tajuddeen Yusuf (PDP, Kogi)-led House Committee on Capital Market and Institutions last month held a conference on the capital market and Nigeria’s economy in Abuja with a view to brainstorming on how to mainstream the market as a major driving force in repositioning the nation’s economy via initiatives that will enable ordinary Nigerians (to) key into opportunities available at the Exchange to increase their propensity for long term investment.”

This could be very positive for Nigerian stocks. There were other indications in a previous post that outlook for Nigerian stocks could improve.  We need to monitor NGE carefully.

“Dogara to Ring Closing Bell at Nigerian Stock Exchange” : http://thebossnewspapers.com/2016/07/08/dogara-to-ring-closing-bell-at-nigerian-stock-exchange/

Are Nigeria and the Rest of Africa Risky Bright Spots After Brexit?

brexit2     I owned the Global X MSCI Nigeria ETF (NGE) a while ago, but dumped it because there were all kinds of political problems there and the stock was going down fast. Maybe I should have held on, and I’m considering buying it again.

“And in Africa, the Global X MSCI Nigeria ETF (NGE) was among the few ETFs momentarily in the green. It was trading flat to higher after tumbling 14% over the past four weeks on Nigeria’s currency devaluation. The fund is shaping up to be the best performer of the week among developing market ETFs, with a rise of nearly 9%. If you bought the fund at the right time, that’s not so shabby.”

And maybe this speaks to Africa not suffering much or at all from Brexit, and that there are some stock-buying opportunities to come.

“3 Risky Bright Spots After Brexit: Gold Miners, Brazil Bank, Nigeria?”: http://blogs.barrons.com/emergingmarketsdaily/2016/06/24/3-risky-bright-spots-after-brexit-gold-miners-brazil-bank-nigeria/

France, Not China, is The Biggest Direct Investor in Africa

France_flag-lgMany people think that China, even though their economy is experiencing some rough spots, is the largest non-African investor in terms of direct investment. The truth is that France is the largest direct investor in Africa, as articles like this one have pointed out in the past.

What does this mean for the individual investor? It means that they could find more opportunities if they weren’t limited to learning only about anglophone (U.S., U.K. and Australian) companies that invest in Africa, for the most part.

Getting more information about French companies that invest in Africa could widen your scope and give you more opportunities.  That’s part of what we do at Africa Investment Report!

Joe Biden and Others Think That Africa is a Country

Joe Biden Vice President of the United States Joe Biden has called Africa a country!  Is it any wonder that many don’t understand Africa and the investment potential that is there? Now it is reported that Nancy Pelosi, too made the same gaffe.

Is this unbelievable or what?  Biden is a past chairman and member of the Senate Foreign Relations Committee, and he has in his mind that Africa is a country????  And the president of the United States, that he serves under, had a father that was from a country in Africa, Kenya.

Those who educate themselves using this site and other resources are going to reap the benefits, while others who wallow in ignorance like these “leaders” will be left behind.

Find out where we’re going with these Africa investment ideas and concepts by signing up for our free newsletter! Sign up in the box to the right, and as a gift for doing so, get our FREE report: “How to Profit From Africa’s Growth Without Leaving Home”.

The Importance of Global Stocks in Your Portfolio

Granada  The Wall Street Journal recently posted some interesting facts and observations concerning investing in foreign stocks.  In the article, it talks about the fact that a great deal of 401(k) accounts lack any foreign focus in terms of either mutual funds, etf’s or stocks.

“Many investors show a preference for the stocks of their own countries, which is called ‘home bias’, but this could ultimately hurt portfolio performance.”

The article goes on to say:

They may be missing out. Experts say a stock portfolio that is widely diversified internationally can provide protection against a prolonged downturn in an investor’s home market. In addition, some market analysts say U.S. stocks look relatively expensive and many foreign markets appear less pricey, which could increase their chances of outperforming in coming years.”

Many investors show a preference for the stocks of their own countries, which is called “home bias”, but this could ultimately hurt portfolio performance.  Many experts actually believe that you can reduce your overall portfolio risk if you are diversified globally.

Africa-focused stocks certainly have a place in incorporating foreign stocks into one’s portfolio.  While there are varying views on how much emerging markets and frontier stocks should be in your portfolio, most experts agree that they should be in there to some degree.  This article, reading between the lines, may advocate a portfolio having around 11% in emerging markets/frontier stocks, but nevertheless implies having some position in these stocks, and most of them do not.

Find out where we’re going with these Africa investment ideas and concepts by signing up for our free newsletter! Sign up in the box to the right, and as a gift for doing so, get our FREE report: “How to Profit From Africa’s Growth Without Leaving Home”.

Standard Bank’s Expansion Into French Africa Teaches Us About Africa’s Investment Growth Potential

标准银行总部 Standard Bank (SGBLY), a banking corporation based in South Africa, has discovered from its experience in the Ivory Coast, that there is plenty of growth potential in the francophone (French-speaking, culture, etc.) countries of Africa. In fact, this was termed to be “a strategic drive”.

This is one example of the fact that when we look at Africa’s investment potential, we cannot just consider the anglophone (English-speaking, culture, etc.) countries there.  There are the francophone and lusophone (Portuguese-speaking, culture, etc.), as well as the Arab countries, in Africa that merit consideration when it comes to investment, since many of them are growing, and businesses like Standard Bank are beginning to recognize that there are opportunities in different cultures.

Find out where we’re going with these Africa investment ideas and concepts by signing up for our free newsletter! Sign up in the box to the right, and as a gift for doing so, get our FREE report: “How to Profit From Africa’s Growth Without Leaving Home”. 

 

Prediction: Many Will “Miss the Boat” Concerning Investing in Africa

Newport Marina Sunset  I have a concern.  The concern is that many of us are going to “miss the boat” for investing in Africa.  Many countries on the continent are growing and, long term, promise to grow.  Unfortunately, many have subscribed to the myths and/or ignored the truths about Africa.  An excellent article concerning this was in the New York Times recently called “The Real Africa” , that addresses, in some respects, the mindset that people have that is holding them back from investing in a continent and people to help them grow and to reap benefits for themselves and their families.

Find out where we’re going with these Africa investment ideas and concepts by signing up for our free newsletter! Sign up in the box to the right, and as a gift for doing so, get our FREE report: “How to Profit From Africa’s Growth Without Leaving Home”. So what are you waiting for?  Do it right now!

Barclays to Reduce Workforce Everywhere – Except Africa!

Barclays Africa Group Limited Barclays, the large bank based in Great Britain, has announced that it will reduce its workforce by 19,000 employees over the next three years in every part of the world that it’s in – except Africa!

Yes, you may have heard it here first, folks, at least in the English-speaking press, except for that of South Africa, where Barclays’ African operations are headquartered, that Barclays has no plans to reduce the workforce in Africa.  We first found out about it in the French press, while the aforementioned-English-speaking press, save for that of South Africa, focused on the drastic reduction in their investment banking business.  At least some are reporting that one of the core areas that Barclays will now focus on will be “banking in Africa”.

According to Agence Ecofin (the French press)Barclays Africa Group Limited was created as a result of the combination of Barclays Bank, Plc in Africa with the South Africa-Based bank Absa, Ltd.  They have 1,300 branches across the continent and offer a wide range of financial services, such as investment banking, retail banking, wealth management and finance.  For Barclays Africa Group Limited alone, there was a net profit increase of 20% in 2013 to $1.1 billion.  Its stock can be purchased in the United States over-the-counter as AGRPY.

Barclays Africa Group Limited Map  Find out where we’re going with these Africa investment ideas and concepts by signing up for our free newsletter! Sign up in the box to the right, and as a gift for doing so, get our FREE report: “How to Profit From Africa’s Growth Without Leaving Home”. So what are you waiting for?  Do it right now!