It is not a revelation that many African economies remain heavily reliant on commodities exports. But just how closely African frontier equities markets’ performance (in USD terms) generally correlates with the global level of commodities prices is somewhat surprising. That’s because the equity market indices of sub-Saharan African frontier markets are completely dominated by domestically focussed sectors, such as financials and telecoms.
Several East African states have become the focus of attention for international investors. Economic growth in the region was around 6% in 2019 and is expected to be around 1-2% in the Corona year 2020. Real estate offers foreign investors good market access and enables them to increase yields and diversify risks
SAVCA’s 2020 private equity survey, which reports on data for the 2019 period, reveals that while there has been an increase in women and black investment professionals within the Private Equity (PE) space over the past few years, there is room for further growth and improvement. As at December 31, 2019, 28% of all investment professionals were female and 43% were black. When looking at fund manager ownership, the numbers start to shrink; only 9% of fund managers are female-owned whilst a growing number – currently 38% – are black-owned.
Tim Staermose, CEO of ST Funds Management, explores how you can be defensive with your investments at this uncertain time, yet still invest in fast-growing companies poised for significant stock price gains
Africa’s economic growth could rebound in 2021, provided that governments manage the COVID-19 infection rate well, according to updated forecasts from the African Development Bank (AfDB).
The total wealth held in Africa rose by a modest 14% over the past 10 years (2008-2018) with three of the largest economies on the continent, South Africa, Egypt and Nigeria performing poorly on most economic indicators according to the AfrAsia Africa Wealth Report 2019, released by Mauritius based AfrAsia Bank. The total wealth refers to private wealth held by all the individuals living in each country and includes all assets (property, cash, equities, business interests) less any liabilities.
After a strong growth in 2017 and early 2018, the global economy is losing momentum and expected to slow down from 3.6% in 2018 to 3.3% in 2019 before returning to 3.6% in 2020. This slowdown is attributable to a confluence of factors affecting major economies. The factors weighing down on growth prospects include, the elevated trade tensions between the United States and China, the natural disasters in Japan, the introduction of automobile fuel emissions standards in Germany, the tariff increases enacted in the United States and China earlier this year, the sovereign and financial risks in Italy, the weakening financial market sentiment as well as the deeper-than-envisaged contraction in Turkey.
The “Belt and Road Initiative” is a future-oriented initiative that will bring many benefits to global economic development and people. Chinese Ambassador to Kenya Wu Peng recently said that the cooperation between China and Kenya has deepened political trust, expanded economic and trade cooperation, and promoted the continuous development of the cooperative partnership.
RisCura has launched a delegated investment solution for smaller pension funds in South Africa. David Potgieter, Head of Delegated Investment at RisCura, says that the new Delegated Investment service is aimed at reducing the burden of cost and administration as well as time constraints faced by many trustees.
Investors have had disappointing returns from domestic equities this year after a promising start. South Africa (SA) is now in a recession and the global backdrop is no longer as supportive, so President Ramaphosa will have his work cut out to instil a new sense of confidence to ignite growth. His stimulus package and a revised mining charter are good signs, but scepticism dominates markets. Hope alone is not– implementation is required. Where might be the turning point?
After the political and economic turmoil of recent years, Morocco has emerged as a safe haven for PE investments, attracting capital from abroad through its political stability and favourable business environment. During the 2012-2017 period, 56 transactions were closed, representing 42% of North African transactions (Morocco accounts for 20% of the total population in North Africa), amounting to nearly $900m.
Private Equity (PE) investments in Egypt saw a golden age in the years between 2005 and 2008 when a significant number of landmark PE investments and exits were executed. Afterward, the sector entered into a quiet phase – despite some opportunistic targets in healthcare and education – with investors facing delayed returns on many fronts due to worldwide market instability in 2008-2009 and domestic geopolitical issues between 2011 and 2014.
