 Why is Africa the best place to invest in right now? Welcome to Africa Reloaded. Africa's best destination into insight on development and Africa's future. Profit, as they say, is the reward for risk. And this is especially true when it comes to investing in Africa. Unlike other continents where investors do not hesitate to invest, Africa is generally regarded as a risky place to do so due to concerns, such as political instability and insecurity. But what is investment if there is no risk involved? In fact, when it comes to investing, the larger the risk, the higher the return. And this has been proven numerous times in Africa. According to a UN conference on trade and development report, between 2006 and 2011, investors in Africa earned the highest returns on investment of any continent in the world, with a rate of 11.4% compared to the global average of 7.1%. Now the question is how come despite the challenges in the continent, investors were still able to get the highest return on their investment. If you want to know more, keep watching Africa Reloaded, as we answer that question and show you why Africa is the best place to invest right now. Take a few seconds to like this video as we begin. Prior to the 2000s, the very mention of Africa conjured up images of diseases, famine, poverty, and violence. Every possible statistic regarding the continent was rooted at the bottom. The situation was so severe that on May 13, 2000, the Economist, one of the world's leading news magazines, published an article about Africa with the ominous headline, Africa, the Hopeless Continent. Many individuals were furious, although the majority of what was written in that piece was accurate. On the other hand, between the year 2012, the continent experienced nothing short of a revolution. Nobody could have predicted the changes that transpired a few years later. More wealth was created in that decade than at any other time in the continent's history. And for the first time since the 1960s, that transition was both bottoms up, new businesses, and even whole new sectors rose up, spurning new unicorns such as Cellulant in the fintech industry and the MTN Group and Econet Global in telecommunications. African governments finally got their act together and provided the macro conditions for this growth to take off, low debt, low inflation, and stronger democratic institutions. GDP growth began to double, exports quadrupled, and public debt fell to the lowest level on any continent. The shift was so great that it prompted an opposing headline in the same publication on December 3, 2011 with the heading, Africa Rising. These enormous changes are undoubtedly what prompted China and other countries to invest in the continent, with China emerging as the continent's largest investor producing more than 18,000 jobs on average. So why this huge rate of investment in Africa? According to the UN conference on trade report, there are several reasons why African investors outperformed those in other continents, including 1. Africa's growing young population Africa boasts the world's youngest population With 70% of sub-Saharan Africa under the age of 30 and by 2030, young Africans are estimated to account for 42% of global youth. This means that labor is abundant for labor-intensive industrialization and the abundance of labor also means low labor costs, which means that the benefit of conducting business 2. Africa's vast natural resources This is, in fact, the primary reason that international investors are drawn to Africa. The continent has been able to portray itself as a storehouse of great resources with stretches of oil reserves and incredible forest land. Africa contains 60% of the world's uncultivated arable land and annually produces billions of barrels of oil and gas. The Democratic Republic of the Congo holds the world's largest cobalt deposit, whereas South Africa accounts for 69.6% of global platinum production. Other rich mineral resources found on the continent include gold, diamonds, titanium, iron, zinc, copper, gypsum, salt, sulphur, and phosphates. 3. Africa's bright economic growth prospects According to the Africa Macroeconomic Performance Outlook Study, published in January 2023, Africa is likely to outperform the rest of the world in the following two years, with real GDP averaging approximately 4% in 2023 and 2024, compared to projected global averages of 2.7% and 3.2%. And, even though Africa's expected average real GDP growth fell to 3.8% in 2022, down from 4.8% in 2021, due to substantial hurdles, such as the COVID-19 shock and Russia's invasion of Ukraine, 53 of Africa's 54 countries had positive growth. The good news is that areas where foreign companies may have a comparative advantage, such as banking, telecommunications, and infrastructure, are among the present drivers of African economic growth, creating clear investment opportunities for international corporations. Now, why should you invest in Africa? Aside from its vast natural resources, bright economic prospects, and growing young population, which should be enough reasons for any investor to jump on board, there are still other reasons why Africa is the best place to invest in right now. Firstly, Africa is one of the fastest growing consumer markets in the world. In recent years, household consumption has expanded even faster than GDP, and average annual GDP growth has regularly surpassed the global average. And given the continent's growing income, population growth, urbanization rates, and rapid spread of internet and mobile phone access, Africa's expanding economies present intriguing potential for investors looking to expand into retail and distribution. In fact, consumer spending on the African continent has increased at a compound annual rate of 3.9% since 2010, reaching $1.4 trillion in 2015. This amount is predicted to rise to $2.1 trillion by 2025 and $2.5 trillion by 2030. Furthermore, if the Continental Free Trade Agreement, CFTA, is effectively implemented, a unified continental market for products and services will be operational in 2030, providing firms with many points of entry to the continent and a potential market of 1.7 billion people. Also, in recent times, Africa has upped its digital coverage at a rate higher than in any other region of the world. This considerably improves access to important knowledge and technical know-how, both of which are essential for exponential economic growth. East Africa, for example, was a pioneer in the establishment of practical and easily accessible digital mobile money payment networks. Villagers and ordinary people who do not have access to banking services can now readily participate in the growth of the economy, both locally and globally. And due to Africa's strong digital penetration, digital hardware and software businesses wishing to invest in the continent will find a ready market. Similarly, manufacturers and business owners will have highly competent programmers, data analysts, and search engine marketers. Finally, in recent decades, African countries' political will and stability have improved. Since the beginning of 2015, Africa has seen over 27 leadership changes, reflecting the continent-wide fight for greater transparency and democracy. Countries such as Mauritius, Botswana, Cape Verde, Namibia, and Ghana rank relatively high in terms of political stability and democracy. Over the last decade, 34 countries, home to 72% of Africa's inhabitants, have improved the governance performance, with major advances in participation, rule of law, and rights, among other areas. The governments of Africa have also revised their policies to accommodate people willing to invest in their countries. This is one of the reasons China has recently increased its investment in various African countries. So, yes, there are still lots of challenges that needs to be tackled to reduce the risk of investing in Africa, but clearly the African continent holds great promise for investors who are willing to take the risk. The key, therefore, to investing in Africa successfully is to investigate what major problems the continent faces and come up with ingenious ways. In partnership with like-minded Africans to solve them. Thanks for watching this video to the end. If you enjoyed this video, give it a thumbs up, leave a comment, and subscribe if you have not done so already. Also, don't forget to put on the notifications bell, so you will be the first to know whenever we upload more videos like this.