News and developments on African capital markets: African securities, African stock exchanges, African equities, African bonds, African private equity/venture capital, and African social impact investment. Twitter @africancapital, LinkedIn African Securities Exchanges group.
The Sovereign Wealth Fund Institute of Las Vegas, USA defines SWF as “a state-owned investment fund or entity that is commonly established from balance of payments surpluses, official foreign currency operations, the proceeds of privatizations, governmental transfer payments, fiscal surpluses, and/or receipts resulting from resource exports”.
9 reasons Africa tops investors’ agenda, Eddy Njoroge told African Securities Exchanges Association, include: economy to rise from $1.1trn to $3.9trn in 5 years, the fastest-growing middle class (from 123m to 1.1bn), population to double to 2.4bn, and record $80bn of foreign investment.
The Ethiopian Government recently closed a $865m financing package to fund part of the development of the country’s giant new railway infrastructure, with 5,060km of rail costing up to $15bn.
The total value of mergers and acquisitions deals in Africa by foreign investors was $183 billion over the ten years 2003-2012, up threefold on the previous decade. Britain was the lead investor with with 437 deals worth $30.5bn.
The World Bank has cut its growth forecast for sub-Saharan Africa. Earlier in the year it forecast 5.2% growth overall for SSA economies in 2012, but yesterday (4 Oct) it cut this to 4.8%.
“Africa reminds me of China back in 1999. If you missed China then, don’t do that (miss Africa) now,” is how Plamen Monovski, chief investment officer at Russia’s Renaissance Asset Managers, describes prospects for Africa. “It’s the last place in the world that is due for that rapid change and advancement.”
Fund-raising for sub-Saharan African private equity funds was $1.056 billion in January to June 2011, down 5% from $1.11 bn in the first half of 2010.Total fund-raising for emerging markets funds for the first half of 2011 was $22.6 bn, according to EMPEA, more than double the activity of the first half of 2010.
Interesting article in today’s FT Tilt on whether China’s model of cheap loans backing Chinese construction squeezes out private equity. The author suggests there could be a secondary round of infrastructure management projects.