Jan 24 (Reuters) – Global institutional investors plan
to boost their asset allocation in African markets over the next
five years, and are shifting to long-term investment strategies
from more speculative, short-term bets, a survey showed.
Africa’s frontier markets — the smallest, less developed
and less liquid among emerging economies — will offer the best
overall prospects for investment growth in the next decade, said
51 percent of the 158 investors polled by Invest AD and the
Economist Intelligence Unit (EIU).
Two-thirds of investors with an interest in frontier markets
see Nigeria or Kenya holding the greatest opportunity, putting
the continent ahead of frontier markets in Asia and Latin
America, the survey showed.
Even among frontier markets investors, most are only just
starting to explore African markets, with one in five of those
surveyed having zero allocations. Among larger investors with
more than $10 billion under management, this is closer to one in
three, according to the survey.
By 2016, however, all expect to have some exposure to
emerging Africa, with nearly one-third expecting to shift at
least 5 percent of their fund value there.
In terms of popularity with investors, Nigeria and Kenya top
the list, followed by Zimbabwe, Egypt, Ghana and Libya.
THE NEXT ATTRACTION
Investors eye Africa’s emerging middle class as the most
attractive aspect of the continent, which until now has been a
largely natural resources play.
Continued…
