“Now’s the Time to Invest in Africa”

The February 2009 Issue of HBR had this article titled “Now’s the Time to Invest in Africa” by Paul Collier and Jean-Louis Warnholz and its interesting to know that growth in Sub Saharan Africa surpasses that of Asia (Nigeria among the countries mentioned).

Highlights of the article are as follows:

• Sustained growth in Africa driven by stability, favorable policies, higher profits and opportunities.
• From 2002 – 2007, average annual return on capital of the companies studied was 65% to 70% higher than that of comparable firms in China, India, Indonesia and Vietnam. Analysis conducted on1,869 African companies confirms that these companies’ median profit margin was 11%, better than the comparable figures for Asia and South America.
• While the IMF projects a 2009 growth rate of 6.3% for sub-Saharan Africa, it says that Nigeria, Tanzania and Uganda will record a growth that is higher than 8%.