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The New Silk Road
Report

The New Silk Road

Afro-Eurasian Investment

Paul Kielstra
Deutsche Asset & Wealth Management, 2014
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Editorial Rating

8

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  • Innovative

Recommendation

Thanks to the economic slowdown in developed and emerging market economies, the search for yield has raised the investment profile of Africa’s “frontier markets.” But the region, though rich in natural and human resources, presents would-be investors with a long list of cautions. Historian and economist Paul Kielstra succinctly reviews the risks and rewards of investing in fast-growing African capital markets. getAbstract recommends this introduction to market analysts and to anyone considering investing in this region.

Summary

Fewer opportunities in developed and emerging economies are sending many investors seeking returns to Africa’s “frontier markets.” These economies – which are “at an earlier state of economic development than emerging markets but which seem capable of moving toward that status” – promise good growth but also present greater risk, less liquidity and smaller market capitalizations. The Morgan Stanley Capital Investment Africa Frontier Market Index rose 54% in 2012 and 31% in 2013, before falling in 2014. Corporate and government debt markets, while thin, are also gaining momentum.

Though abundant...

About the Author

Historian and economist Paul Kielstra is a contributing editor at the Economist Intelligence Unit.

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