Published:
September 29, 2008
The
correct answer is
(E.) Nigeria
Nigeria, the largest African
country by population (with 140
million citizens), is admittedly
very poor: Seven in ten residents
live on less than US$1 a day. But
thanks to rapidly rising revenue
from oil exports -- with China
supplying the lion's share of demand
growth -- Nigeria's economy has
grown at an annualized rate of about
+6% over the past five years. As a
result, the country's stock market
has been one of the best performing
in the world over the past few
years, returning more than +200%
over the last five years alone.
In the past decade, we've witnessed
a sea of change in the attitudes of
investors toward emerging markets
like Nigeria. Once largely avoided
as volatile and unprofitable,
markets such as China, India and
Brazil have generated steady and
surprisingly strong investment
returns over the past decade. These
markets have years, if not decades,
of strong performance ahead of them.
Many experts think Africa will be
the next economic and investment
frontier due to an enormous
population, tremendous natural
resources, a growing number of
democracies with reform-minded
leaders, and plenty of room for
economic growth. This year, with
most developed economies barely
eking out positive economic growth,
many African economies continue to
tear up the track with expected
growth rates in the +5-7% range.
Unfortunately, individual U.S.
investors can't buy stocks directly
on the Nigerian Stock Exchange. But
don't get discouraged; there are
still a number of ways U.S.
investors can tap into the hot
Nigerian market. And StreetAuthority
editor Nick Lanyi has done all the
leg work for you. In fact, in the
latest issue of his
High-Yield International newsletter Nick takes a long look
at Nigeria and African income plays.
He also profiles a high-income stock
that serve as a proxy for growth in
Nigeria and other top-performing
African markets. To learn the names
of this stock, and to learn more
about the
High-Yield
International newsletter,
please visit this link.
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