Nisela Capital
Why Sub Saharan Africa

Why Sub Saharan Africa

ABUNDANT UNTAPPED RESOURCES ABUNDANT UNTAPPED RESOURCES

Sub Saharan Africa (SSA) has a dominant share of a number of resources, including platinum, copper, cobalt, and agricultural land, that are not only highly sought after but are also necessary for the development of the continent. Despite this, SSA still remains relatively unexplored, offering further resource potential for the continent. Urbanisation the past decade has seen SSA become more urbanized, with around 40% of Africans currently residing in urban areas, but at current growth rates, this is estimated that more than half of SSA population will be urbanised by 2030. With the rapid rates of growth, urbanisation and the rapid job creation, the increase in disposable incomes will spur the emergence of a growing middle class, creating numerous investment opportunities.

IMPROVING POLITICAL CLIMATE AND GOVERNANCE STRUCTURES IMPROVING POLITICAL CLIMATE AND GOVERNANCE STRUCTURES

Whilst corruption remains a concern across SSA, the region has made significant improvements in this regard. Political conflicts in Sub Saharan Africa are no longer the norm, as democracy is being institutionalised across the region; driven by the increasingly democratic electoral processes, as well as the reduction in conflicts.

RELATIVELY HIGH REAL GDP GROWTH RELATIVELY HIGH REAL GDP GROWTH

Both historic and expected GDP growth for the continent is high. According to the IMF, between 2004-08 real GDP growth in SSA has averaged 6.5%. Looking ahead the region is expected to in excess of 5% through to 2015 The continent has some of the fastest growing economies in the world, including Angola, Ghana and Nigeria.

ATTRACTIVE VALUATIONS ATTRACTIVE VALUATIONS

As a result of limited levels of liquidity and relatively lower international interest compared to other emerging markets, SSA companies have relatively low valuations in comparison to their peers, on a growth-adjusted basis. This represents an opportunity for investors that understand the continent and can identify attractive investment opportunities.