Monday, December 10, 2007

Can Greed Save Africa?

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One of my favorite movies of all time is Wall Street, starred by Michael Douglas. Wall Street is a movie that embraces and rewards greed, despite the fact that this movie break all business rules and ethics. In the movie, Michael Douglas proclaims, "greed is good". The word greed usually has a negative connotation associated with it. In this case, Businesss Week's article, "Can greed save Africa" raises some important points and begs the question will capitalism embrace growth in Africa? In Africa's case, many international investors are flocking to the continent looking at great bargains.

The article talks a little about the illiquid markets and how hard it is for some investors to buy large block of stocks or assets because of the bureaucratic or slow banking sectors on the continent. I remember many investors were saying the same thing about South America in the early 90's. Now, Brazil and other South American economies are enjoying unprecedented growth. Despite all of this, many are still finding great bargains and opportunities all over Africa.

Many institutional investors who have read this article or this blog are going to kick themselves if they don't invest now. The fact is, in 5-10 years there will be more competition to buy or invest in assets in Africa. Africa, now more then ever, has greater choices for trade and investment. We don't have to go begging to our European masters, we can partner with up and coming emerging markets like; India, China, and Brazil.

This article is an important shift in the way the international investors are looking at the new and promising opportunities in Africa.

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