I read several months back that the African continent has been growing at an average rate of 5%. That's nowhere near as sexy as Mainland China or India. But it's still not bad.
And I am reminded of that when reading William Pesek's latest Bloomberg column on Chinese investment in the Dark Continent.
I'm not familiar with the specific Chinese bank Pesek focuses on. And you know I doubt his speculation on why Warren Buffett sold PetroChina. But the general thrust of his column seems spot on to me.
Africa could be -- note the words "could be" -- the perfect contrarian emerging markets play. That is, everyone is raving about Mainland China and India (and even Asia). Yet a few years from now we all wake up and start reading -- after the fact -- that pan-African investments have outperformed the emerging markets darlings.
Please understand: that is not a prediction.
But it wouldn't be all that surprising for those of us often doubting the conventional wisdom. (Then again, any continent with Robert Mugabe, well, you know.)
And it's the reason I've kept my eye on Lonrho PLC, the conglomerate trading in London. It offers Western style corporate governance and the company is investing in a range of diversified businesses in a variety of African countries. The problem is it has shot up in price a good bit since I found out about it. And, even more importantly, I have a hard time finding hard information about it (other than its Website).
Anyone with good information on the company, feel free to shoot me an email or leave a comment.