While Sen. Barack Obama tours Europe and the Middle East, a portion of the world likely to draw new interest is the African continent.
His campaign will particularly put a focus on Kenya, the nation which sent his father to the United States as a student. It drew an unexpected dose of attention due to violence after a disputed presidential election.
Previously, Kenya had been regarded as the most stable economy in East Africa. The fundamentals have not changed despite the turmoil and a big reduction in tourism. Most importantly, Kenyans seem to believe in their future.
The Nairobi Stock Exchange’s NSE20 Index rose 37 percent in 2007 from 3973.04 to 5444.83. Its bond market handled $1.3 billion US compared to $223 million in 2005. There have recently been five Initial Public Offerings.
Because of increased automation, it is possible for American shareholders to invest in this and 15 other African markets. A decade ago, a $50 investment in Ashanti Goldfields of Ghana grew ten-fold before the company was purchased by Anglo-American of South Africa.
Gold is one of the commodities driving up prospects for African companies in such spots as Nigeria, Angola, South Africa.
As noted before, putting money in African stock markets is a long-term strategy that involves as much learning about other cultures and geography as investing. For investment clubs, it can tie in travel to research companies. For individuals, it gives a way to get involved in foreign trade without buying containers of art or fabric.
The cable channel The Africa Channel which presents a variety of African news, business and entertainment programs is a good source of information for potential investments.
As we discuss in our book Blackmoney: Advanced Strategies for Maximizing the $1 Trillion Blacks Receive Worldwide Yearly, Africa is desperately in need of direct foreign investment, only attracting $4 billion per year, while African-Americans make more than $750 billion yearly in income. It doesn’t take a rocket scientist to understand that American blacks could help build the infrastructure for new pharmaceutical companies to create the drugs to solve Africa’s health crises, an initiative now being pushed by the African Union, or take advantage of the rising costs of commodities as owners of African companies.
Mutual funds geared to emerging markets can be a safer way to start this process of diversifying globally while creating a social responsibility screen to support Africa’s development. Tomorrow, we’ll look at Caribbean investment opportunities.