AFRICANGLOBE – War, famine and political instability in Africa overall have receded while economic activity has surged, making the continent attractive for foreign investment despite the still-high security and logistical challenges.
Since 2002, despite a tough global economy, the overall African economy has more than trebled, Ernst & Young said in its “Africa 2013” report.
The rapid growth is expected to continue. The International Monetary Fund forecasts 11 of the world’s 20 fastest-growing economies through to 2017 will be in Africa. Some 27 African nations have already reached “middle income” status, and at current growth rates as many as 40 (75%) could achieve that by 2015.
Foreign direct investment inflows to Africa will set records in each of the next three years, reaching $54 billion by 2015, the World Bank predicted. FDI was $37.7 billion in 2012, up 5.5%, when FDI flows for developing countries fell on average by 6.6%.
A growing number of global honchos, some with controversial pasts, are saying “jambo” — Swahili for hello — to Africa. Some have billionaires helping in the background.
Ex-Barclays chief Bob Diamond said on Dec. 7 that he was trying for a comeback via a shell company on the London exchange to invest in Africa’s financial sector. Diamond, ousted from the British financial powerhouse in 2012 over the Libor rate-rigging scandal, is in the process of listing Atlas Mara. Ashish Thakkar, Ugandan-born founder and CEO of Mara Group, is backing the investment firm. Mara is a conglomerate with extensive interests in Africa.
Erik Prince, founder of the world’s biggest private military services firm, Blackwater Worldwide, announced Nov. 24 that his wholly owned Frontier Management sold its Africa-focused aviation and logistics firm Frontier Services to DVN. The price was $3 million plus the grant of an option for up to 205.116 million new shares of DVN. DVN is an investment company whose major shareholders include Hong Kong tycoon Johnson Ko and China’s state-owned investment company CITIC.
Marriott CEO Arne Sorenson in November acquired hotel chain Protea Hospitality of Cape Town, South Africa, in a deal reportedly worth $200 million. That gives Marriott 10,000 hotel rooms in various countries in Africa and makes it the continent’s largest hotelier.
Another billionaire, Thomas Pritzker, chairman of Hyatt Hotels, told India’s Economic Times in October that he’s placing his future bets on Africa. “(Africa) will spring a real surprise on the world,” Pritzker said.
By: Doug Tsuruoka