*2020 relates to the six-month period ended June 30 2020.
The regional split and the investment themes of funds raised indicates that the market still favours generalist funds with a wide regional mandate. This may be due to Africa’s economies remaining largely informal and fragmented.
According to the IMF, the informal sector makes up from 20%-25% of GDP on the lower end, in Mauritius, South Africa, and Namibia, up to a high of 50%-65% in Benin, Tanzania, and Nigeria. Along with small, fragmented, and poorly connected markets and a high cost of compliance, these factors limit the number of investable opportunities available to investors. This limitation necessitates a wider mandate to ensure sufficient opportunities with a desirable risk and return profile that can be identified and evaluated.