Diverse insights into Africa

With our diverse client base and strong African roots, RisCura has a well-placed view on investment in Africa. Bright Africa is our research resource that seeks to answer key investor questions by providing insight into the drivers, enablers and managers of investment on the continent.

learn more

powered by RisCura

RisCura helps global investors achieve best performance with investment services, strategic advice, analysis, reporting and administration support.

learn more
Asset 1

Investment in Africa

Investors consider regional opportunities. It has become important to not only analyse Africa, but to consider how its different regions measure up to their global counterparts.

learn more

Segmenting Africa into meaningful markets

RisCura has identified meaningful regions in Africa by analysing synergies, attractions, flaws, cultural differences and business practices.

learn more

How Africa's regions compare

Investor interest is reinforced for high growth-rate regions like the Maghreb, East Africa, Ghana and Francophone West Africa.

learn more

Africa's links to the globe

East Asia and Western Europe remain the continent’s most significant import region; with China being the top import partner for machinery, electronics, vehicles, mineral fuels and cereal.

learn more

Inter-Africa connectivity

The cost of moving goods domestically can also be up to five times higher in Africa than in the US, but the African Continental Free Trade Agreement seeks to tackle challenges facing trade within Africa.

learn more

Currency risk – Exchange rate regimes

Most African countries have a pegged exchange rate regime, with conventional pegs being the most popular.

learn more

Currency risk – The Milk Index

The Milk index infers price levels across the markets, seeking to identify under and overvalued currencies against the US dollar.

learn more

Pension Industry

The latest Bright Africa Pensions research looks highlights how African demographics are evolving and the impact of this on long-term savings.

learn more

Pensions industry progress underway

Regulators are reviewing legislation, governments are experimenting with unique solutions such as micro-pensions, asset allocations are changing to allow for greater long-term growth and across the continent, the high rate of mobile penetration is being viewed as a significant opportunity to innovate.

learn more

Pension coverage and Africa’s informal economy

A major issue African governments face is that 85.5% of their working population are informally employed. To avert fiscal and social stress, policymaking on pensions and social security in Africa needs to quickly move to enable affordable, convenient, and secure micro-pension products to be established.

learn more

Africa’s pension fund assets

The composition of African long-term assets mimics the global picture, where a few countries claim the largest proportion of long-term savings. In Africa, 95% of the assets are concentrated in South Africa, Nigeria, Kenya, Namibia, and Botswana.

learn more

Asset Allocation

For the selected pension funds within this report, South African, Botswanan, and Namibian asset allocations continue to reflect greater allocations to equities, more so than OECD countries. For the rest of the African countries, the picture continues to illustrate a skew to fixed income.

learn more

Conclusion

For Africa’s pensions industry, the road ahead will be thorny, and no doubt full of delays, but awareness of the problems is there, coupled with firm intentions to solve them.

learn more

Listed equity

The liquidity of Africa’s exchanges took a significant knock in 2019 and the cost trading on its stock exchanges is significantly higher than developed markets.

learn more

Africa’s stock exchanges

Apart from the Stock Exchange of Mauritius (MUSE) that experienced a 57% increase in daily turnover, all other exchanges saw a decline in their daily turnovers for 2019 when compared to 2018.

learn more

Private Equity

This research aims to highlight the current state of the private equity market in Africa, and trends in prices paid for private equity assests over time.

learn more

Introduction

This Bright Africa Private Equity report focuses on the PE ecosystem in 2021 – including fundraising, dry powder, investments and pricing – and considers some interesting trends

learn more

Fundraising over time

Before the remarkable market contraction in 2020 and 2021, private equity (PE) fundraising activity across Africa showed strong growth between 2016 and 2019.

learn more

Dry Powder

We have estimated the dry powder of the African Private Equity Industry, using fundraising data and the average deployment period RisCura observed.

learn more

Investment activity over time

The extent to which supply of investable opportunities exists cannot be observed directly. However, the level of deal activity at which investors make such investments can be measured.

learn more

Exits

The volume of exits and the quality of exit routes available in Africa have been key concerns for investors looking to access African PE. However, data shows that exits are taking place in Africa.

learn more

Changes in perceived risk and reward

The perception of risk and returns, compared to other investment opportunities, influences the PE market. We explore the theoretical cost of equity, which reflects the perceived risk of the different markets.

learn more

Private Equity Pricing

Many of the drivers of price changes are unobservable, so it is often difficult to interpret changes over time. We assess the data available.

learn more

Conclusion

When looking at the prices for private equity assets in South Africa and Africa and the landscape that influences it, we can see market fundamentals reflected.

learn more

Sovereign Bonds

African Eurodollar and local currency sovereign bonds, bills and notes had a total value of around USD 0.5trn as at July 2019.

learn more

Size of the Universe

The total value of the debt outstanding is concentrated in five countries, making up 81% of the total bonds outstanding

learn more

Holders of Sovereign bonds

The analysis covers the two countries with the largest sovereign debt balances. In both countries, local investors exceed foreign investors.

learn more

Infrastructure

The AFDB estimates around USD 35-47bn is needed annually in Africa to spend on road, rail, air and port infrastructure, with most (80%) allocated to maintenance & rehabilitation of existing infrastructure, which has become outdated and inefficient. Globally, investors allocated a record high of USD 85bn to Africa’s infrastructure funds in 2018, and the positive momentum is expected to continue.

learn more

Financing

Africa will have to overcome challenges to gain more private sector investment to meet its infrastructure development funding deficit.

learn more

Structure

Alternative structures and avenues are opening, allowing investors to access this asset class more readily.

learn more

Road

Several road infrastructure development projects are in progress in West Africa and East Africa that could set a precedent for other projects on the continent.

learn more

Rail

Southern Africa still has the continent’s largest rail network, but East Africa and West Africa have substantial rail expansion projects on the go that could see rail connectivity increase, linking several countries.

learn more

Energy

Although conventional thermal power makes up the bulk of capacity in South and North Africa, there is good potential for growth in the use of renewable energy on the continent.

learn more

Ports

Despite the majority of all African trade being through imports and exports at its largest regional ports, the continent’s ports handle only 6% of global water borne traffic and only 3% of global container traffic (Source: World Atlas).

learn more

Real Estate

Even though many international companies have looked to expand into Africa in the last decade, the uptake of physical office and retail space is slower than expected.

learn more

Office Space

The property market has long received attention from Africa’s institutional investors, especially in countries with relatively small and under-developed capital markets.

learn more

Retail space

New developments in the retail sector over the past ten years have increased the supply of A-grade shopping centres and contributed to increased rental rates in local currency over this time.

learn more