May 27, 2008
Maghreb & Africa
But in keeping with the amusement factor today, let me highlight this:
In its 25th March 2008 publication, El Watan laments Algeria’s “loss of influence” as it relies too heavily on its political clout in the region while “the oil, natural gas and the billions of dollars it possesses are likely to be more effective than the miles and miles of speeches the president is likely to make.” The newspapers notes with some deserved severity that “when someone from Gabon, Ivory Coast or Cape Verde has to cross Casablanca to reach Algeria, he’ll think twice before making a decision.
Actually the visitor will think twice first due to the cretinous Sovietesque travel regulations that Algeria imposes, which make one think one is time-warping back to the 1970s
Posted by The Lounsbury at May 27, 2008 07:06 PM
Filed Under: Biz - Private in MENA
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Well, warning: what I'm about to say is not politically correct...
Whereas I'm all for any North African involvement in Subsaharan Africa (understand: some sort of politically acceptable imperialism) because of its feasability, doing it in an effective and useful (understand: profitable) way requires a level of political and economic maturity totally absent in the Maghreb.
Plus, from a private sector point of view, even interested in frontier markets, except in very specific circumstances and types of investments, I wouldn't touch Subsaharan Africa with a pole if there's no public (any Maghrebi gov) backing (understand: by military means if necessary), which again requires a maturity and a diplomatic build-up totally absent in the Maghreb.
So as far as I'm concerned, Subsaharan Africa is thrown to the dogs. Which makes that article another piece of panafrican whanking.
(I might have a more nuanced view on Senegal, maybe Mali, though still, and my comments of course exclude South Africa, Botswana and some islands).
Leaving aside political correctness, I think your view of SSA opportunities is outdated, and I base that on direct business experience, currently and going back 10 years.
A lot has developed for the positive. Frontier markets to be sure, but this is not 1993 anymore.
Of course I would still stay away from Nigeria and Congo-Kinshasa
Posted by: The Lounsbury at May 29, 2008 12:09 PM
Being largely uninformed on SSA, I'm curious about which ways it has improved over the last 10-15 years, aside from the winding down of several civil wars. It's so rare one hears good news out of that region.
Posted by: Djuha at May 29, 2008 04:37 PM
Col., I'm curious too. Could you be more specific?
When I get a moment. There is quite a lot of growth actually.
Posted by: The Lounsbury at May 29, 2008 09:45 PM
Lots of Chinese investment in East Africa, I understand.
Posted by: matthew hogan at May 30, 2008 03:13 AM
Yes, indeed, but there is a lot more fundamental, real infrastructure investment than one has seen in .... 30 years I would say. That is opening up new opps. Best opportunities in my mind, besides extraction, but that is no new news, is in intermediation services, esp. in financial services - basic core services.
The problem Africa has is .... well Africa. It ain't one place, Nigeria -e.g.- remains a mess and I would not go there, but the bad news of the worst performers sets the image. Rather like the Maghreb suffers from being lumped in with Middle East, when in fact its issues largely have fuck all to do with Palestine, Iraq, etc.
Posted by: The Lounsbury at May 31, 2008 02:25 PM
Hi. New here. I was a commercial lender in Africa for ten years and then spent some time in a development agency. Now I work in Morocco and am helping Moroccan companies look at opportunities in SSA. There are many. It is a natural market, given the scale of economies, their lack of sophistication, low production costs in morocco and language questions (francophone is key for west africa).
I would also like to say that alhtough Nigeria is a mess, it is a huge opportunity, there is significant oil liquidity flowing around but management talent is very scarce. Salaries for bankers are going thru the roof. Infrastructure investment is booming and Africans are becoming a consumer culture just like the rest of us.
I remember I heard once that demand drives economic growth. There is serious growth of domestic demand in most of the more stable SSA countries and this is driving opportunity
Posted by: Michael at June 8, 2008 10:22 AM