Why Africa?

A Continent Rich with Opportunity

Africa is the second largest continent by land area and population, behind only Asia. As its economies keep growing and its standards of living keep rising, high-growth public companies are emerging on the continent. We have the knowledge, experience and process to help you identify and take part in this emergence. We believe that exposure to quality public companies can enhance investors’ overall exposure to emerging markets. And since Africa remains the least-researched sector in the emerging/frontier markets, its stock market valuations are relatively attractive.
  • Class A

    • Nile Africa, Frontier & Emerging (NAFAX)

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    Class C

    • Nile Africa, Frontier & Emerging (NAFCX)

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    Institutional Class

    • Nile Africa, Frontier & Emerging (NAFIX)

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  • Africa in the News

    Learn more about investing in Africa.

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  • Why Africa? Why Now?

    An Emerging Middle Class

    The African continent is developing its own economic identity and infrastructure, similar to the European Union. Our pan-African perspective seeks to identify multi-national companies based in the region that have the potential to grow with cross-border commerce and a rising consumer market for basic and discretionary goods and services. Primed by a growing population and emerging middle class, we believe the continent’s collective spending power will expand and create opportunity as a result.

    Opportunities in Infrastructure

    The African continent needs a massive amount of infrastructure development. A significant amount of capital is currently being put towards solving this challenge. Physical – housing, water, sanitation, energy and transportation – and digital infrastructure solutions are sorely needed, companies involved in these solutions may potentially benefit.

    A Strategic Source

    Africa is a resource-rich continent with vast mineral reserves. It holds an estimated 30% of the world’s mineral reserves including 40% of the gold, 60% of the cobalt, and 90% of the platinum group reserves. And according to the National Intelligence Council, 25% of U.S. oil imports will come from Africa by 2015. The largest economies in the world, including the U.S. and China, are looking to Africa to supply many valuable and strategic natural resources.

    Certain African markets are in only the earliest stages of development and may experience political and economic instability, capital market restrictions, unstable governments, weaker economies and less developed legal systems with fewer security holder rights.

    Regional Profiles

    Active Capital Markets

    The African continent’s stock markets and public companies collectively represent approximately $1 trillion USD in market capitalization. Among Africa’s 54 countries, there are about 23 active stock markets on which about 1,500 companies are listed, in total. These countries can be divided into four main regions, as shown here.

    South Africa

    With a population of about 50 million, South Africa has the continent’s largest economy. Its 2009 estimated GDP of $277 billion (U.S.) represents about 23% of Africa’s total economic output. Along with Nigeria, South Africa has by far the continent’s largest public stock market by market cap. The country’s market and leading stocks are components of the EAFE Emerging Markets Indexes, and its currency, the rand, is among the most actively traded emerging markets currencies in the world. The country has long been a major source for diamonds and it is the world’s largest producer of gold, platinum, manganese, chromium, vanadium and titanium.

    Eastern and Southern Africa

    This remains Africa’s poorest and least economically developed region. Kenya and Angola are its largest countries by GDP and Kenya is the largest country by stock market capitalization in this region. The recent oil and gas discoveries in Uganda and Kenya, as well as the development of oil fields in Southern Sudan, will spur significant foreign capital investment in the region. Botswana, Zimbabwe, Angola and Democratic Republic of Congo, continue to be favored destinations for metal and mining investments.

    Northern Africa

    The six nations of Northern Africa: Egypt, Morocco, Tunisia, Sudan, Libya and Algeria, are encompassed by the expanse of the Sahara Desert and consist of predominantly Islamic cultures. Egypt is by far the most populous of these nations, with 83 million people, and it also has the largest GDP ($188 billion in 2009). Egypt and Morocco each have fairly active public stock markets, with the fourth and third largest market capitalizations on the continent, respectively – behind only South Africa and Nigeria.

    Western Africa

    The nations of West Africa are producing some of the continent’s highest rates of growth as former colonized areas move toward democratic independence and higher standards of living. Nigeria has the most people of any country in Africa, with a 2009 population estimated at 149 million. It also has the continent’s second highest GDP of $165 billion (2009), behind only South Africa. Western Africa has become one of the world’s fastest growing oil and gas producing regions in the world, and it also is a source for valuable strategic minerals.