RenCap sees African growth outpacing Asia
Thu May 19, 2011 10:25am GMT
By Joe Brock

LAGOS (Reuters) - Investment firm Renaissance Group believes African economies can outpace the fastest growing countries in Asia and expects to invest around $2 billion in the continent by 2014, the CEO of the group's investment bank told Reuters.

The Moscow-based investment group, focused on emerging markets, believes countries like Nigeria, Liberia, Ghana and Uganda could emulate the sustained double-digit GDP growth seen in some of the fastest growing emerging economies like India and China.

"I think it is probable that in the coming decades large parts of Africa will outpace the growth enjoyed by Asia," Stephen Jennings, the CEO of investment bank Renaissance Capital told Reuters on Wednesday at its investment conference in Nigeria's commercial-hub Lagos.

"We have expansion plans across the continent. I can easily imagine us investing a couple of billion dollars over the next three years," Jennings said.

Political turmoil in North Africa this year has turned some investors to safer havens but many international banks are looking to raise their exposure in a continent which has rich natural resource reserves and strong trade ties with Asia.

Jennings believes sub-Saharan Africa will be attractive to investors because it has a more stable political outlook than its northern neighbours and some of the booming emerging economies of the BRIC (Brazil, Russia, India, China) group.

"Not only is political risk coming down quite dramatically and government improving in sub-Saharan Africa but compared with some other quite big emerging markets it is actually in a more advanced democratic stage, there are some BRICs I could name that have to go through phases of (democratic) transition."

NIGERIA

RenCap intends to make Nigeria its main African investment banking hub, a country it says has huge economic growth potential due to its vast population of 150 million people, improved political landscape and reform plans.

Nigeria held elections last month that were considered the fairest Africa's most populous nation has held since the end of military rule in 1999, although they were also some of the bloodiest with post-election violence killing at least 800.

Although its large population attracts investors because of the mass potential consumer base many of the country's inhabitants live on less than $2 a day, while businesses are hampered by poor infrastructure and chronic power shortages.

April's elections and the passing of a sovereign wealth fund bill this week have given some investors confidence that ongoing reform plans for Nigeria's power and energy sectors could succeed where decades of former attempts have failed.

Goodluck Jonathan made ending chronic power outages one of his key campaign commitments before winning the presidential vote and has laid out a roadmap for privatising the sector.

"Power is key. I'm very positive about reform. Reform has been improving in Nigeria for sometime," Jennings said. "I'm very bullish , we see Nigeria as the next Brazil or Russia."

Rencap has around 120 staff across six African offices.

http://af.reuters.com/article/investingNews/idAFJOE74I0DW20110519?pageNumber=2&virtualBrandChannel=0&sp=true

they sound like a chin chin investor!

Cheap talk

I just hope they are holding their breaths.

Nigeria's potential is massive! I think given the right environment, it would out perform Brazil, Russia and India.

We have some of the world's worst infrastructure- Roads, Power, etc.
We have some of the world's worst business environments.
We have some of the world's most corrupt humans.
We have some of the world's "unsafest" cities.

Yet,
We have one of the best performing economies in terms of GDP growth rate.
We have one of the best Return on Investment rates worldwide.
We have the likes of MTN, Dangote, NB, Banks, etc churning profits running in billions of dollars!!

Imagine we get Power [/b]and [b]Road and transport infrastructure right, Stamp out Bureaucracy and Corruption [/b]and get the right kind of [b]Human capital! The country's economic development would blow up like Clutter bombs in thermobaric proportions!! If we can do so good in the absense of these neccessities, then imagine!!

There would be skyscrapers rising out of trenches like Nnewi and Calabar. Automanufacturing lines churning out trucks form the likes of Benin and Kaduna. And world Class research institutes springing up in places like Ile Ife and Zaria. Business Parks in the likes of Warri and Lagos. These would dominate the headlines if we just get our infrastructure and red tape right!

^^
All depends on the big IF. If we stamp out corruption, if we improve upon our infrastructure. . .

Surely does depend on the big IF. I hope Jonathan doesn't disappoint considering the overwhelming support he got at the elections!! The first sign would come from the kind of cabinet he chooses to pick. If he chooses cronyism over competence than we would have to pray that by some stint of faith the reins of governance as regards infrastructure development would be handed over to the private sector in the form of PPPs. That would be the only hope we would have left!!

PapaBrowne:

Nigeria's potential is massive! I think given the right environment, it would out perform Brazil, Russia and India.

We have some of the world's worst infrastructure- Roads, Power, etc.
We have some of the world's worst business environments.
We have some of the world's most corrupt humans.
We have some of the world's "unsafest" cities.

Yet,
We have one of the best performing economies in terms of GDP growth rate.
We have one of the best Return on Investment rates worldwide.
We have the likes of MTN, Dangote, NB, Banks, etc churning profits running in billions of dollars!!

Imagine we get Power [/b]and [b]Road and transport infrastructure right, Stamp out Bureaucracy and Corruption [/b]and get the right kind of [b]Human capital! The country's economic development would blow up like Clutter bombs in thermobaric proportions!! If we can do so good in the absense of these neccessities, then imagine!!

There would be skyscrapers rising out of trenches like Nnewi and Calabar. Automanufacturing lines churning out trucks form the likes of Benin and Kaduna. And world Class research institutes springing up in places like Ile Ife and Zaria. Business Parks in the likes of Warri and Lagos. These would dominate the headlines if we just get our infrastructure and red tape right!

Indeed.

Hmm. Can you tell us more about Rencap, especially their past investments and how well they fared?

^^^^
RENCAP has become one of the foremost Global Investment bankers on the Nigerian scene! They came in at the time the stock market was booming and stuck with us even when it crashed! I admire their guts! They are betting bullish on the Nigerian market! A huge risk when you consider the potential for political upheavals this country presents every now and then.
They are a Russian Company with an international outlook.

Below is a brief on the company from wiki!

Renaissance Capital is a leading investment banking firm that operates in high-opportunity emerging markets. It is a top-ranked investment bank for M&A, equity and debt capital markets, as well as securities sales and trading. Renaissance Capital focuses exclusively on emerging markets, including Russia, the Commonwealth of Independent States (CIS), and sub-Saharan Africa. The company was founded in 1995 by a group of founding partners, including Stephen Jennings, who is today CEO of Renaissance Group, as well as Boris Jordan, and Leonid Rozhetskin.
Renaissance Capital is unique in that it has no "home office", but rather its businesses are run from the markets it serves. Specifically, the firm's offices are in Moscow, Kiev, Almaty, Lagos, Nairobi, Accra, Harare, and Lusaka. Renaissance Capital also maintains offices in London, New York, Dubai, and Nicosia.
Renaissance Capital is part of Renaissance Group, which also includes investment management, merchant banking, and consumer finance businesses. Renaissance Group is a partnership wholly owned by the firm's management.
The firm may buy or start a brokerage in Egypt that would also cover Morocco and Tunisia and also plans to move into Angola, Uganda, and Rwanda in 2011.

http://en.wikipedia.org/wiki/Renaissance_Capital_(Russian_company)

Maybe if we get rid of the dead weight as in the North.

70 million people would still be a lot of people.

^^ Dead weight
just stick to your MBA terms and leave science out.
Dead weight ko, live load ni.