The investment world’s fixation on global inflation and whether we are approaching the peak and heading towards a recession, has many investors sitting on cash, waiting for signals of a better market. Despite this, investing in South Africa presents a convincing opportunity.
At the height of the COVID-19 pandemic, the world was primed for a substantial increase in health and biotech spending and investment. Governments and the private sector alike promised to dedicate funding so that they would be adequately prepared for the next pandemic if or when it came.
The world is beset by extreme inequality. In fact, a study released in December 2021 found that global inequality is at levels not seen since the peak of Western imperialism. And, while we tend to focus on things like income inequality and unequal access to resources, there are also serious levels of inequality in the investment space.
Banks in Nigeria could see reduced earnings, alongside weaker lending growth and asset quality, after the Central Bank of Nigeria (CBN) raised its main monetary policy rate (MPR; repo rate) by 150 basis points (bps) on September 27. The monetary policy committee's latest move not only raises the repo rate to 15.5%, but also banks' cash reserve requirement to a minimum of 32.5% (up 500 bps), amid persisting foreign exchange shortages in the country.
Emerging markets are resilient and better positioned than developed markets to face the current uncertain global environment, according to Franklin Templeton Emerging Market Equity’s Andrew Ness.
The global venture capital (VC) ecosystem is no stranger to the common challenge that female entrepreneurs face – lack of funding. Research by the World Bank shows that for every $1 invested in women, $25 goes to men in the African startup space.
We are currently in a very uncertain period of abnormally high inflation, increasing interest rate cycles, increased global geopolitical risks, decreasing global liquidity and potential recessions. Although recessionary fears seem to have abated for the time being, at GraySwan we remain cautious of implementing shorter-term strategies against a backdrop of market uncertainty. Instead, we urge investors to consider hedging as an effective risk management tool to provide better portfolio protection and diversification.
One of the most topical issues occupying the minds of leaders in governments, policy makers, corporates and scenario planners alike in recent times must undoubtedly be the adverse effects of global warming. Apart from a few climate change denialists, there is general consensus in the scientific community that worldwide adverse and erratic climate conditions experienced in recent years are largely attributable to global warming.
As economies across Africa look to recover from the economic devastation wrought by COVID-19 and the global supply chain issues that followed it, investment will be more important than ever. But it’s also becoming increasingly obvious that if the continent is to achieve its true potential, a different kind of investment strategy is needed.
South Africa faces possible grey listing by the Financial Action Task Force (FATF). This warning was set in October last year when we were to pull up our socks and improve on shortcomings in identifying, reporting on, and prosecuting illegal cash flows and crime. We were given a year (to October 2022) to prove we are making improvements, with February 2023 as the deadline to demonstrate progress on these improvements.
Russia launched a full assault on Ukraine, its southwest neighbour, on February 24, 2022, marking a significant escalation in the ongoing Russian-Ukrainian conflict.
Globally, responsible investment is still in its early stages, and South Africa has the potential to play an important role in elevating it to the next level.
Interpreting the changes that take place in private equity (PE) prices over time isn’t straightforward as many of the drivers are unobservable. But there are some noticeable shifts in the marketplace that prove how PE is performing.
For years, Africa’s financial potential has been recognised by many global investors. As Africa is home to eight of the 15 fastest growing economies in the world, its economic prosperity matters globally. However, the pandemic has hit the Continent hard, with significant recovery set to take several years. Now more than ever, Africa requires investment, and that investment offers great opportunity, both to global investors and the future of the continent.
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