Doing Business with Africa

Doing Business with Africa is a win-win forBlack Business want to do business with their home country. It doesn’t make since to me if we continue to call ourselves African Americans and we have no Economic dealings with these home Countries. It’s away of gaining a since of nationalism a since reconnecting to our roots. These loans or business agreement between the Home land and Diaspora will be able to allow Each have a Stake Agreement. A Stake Agreement allows each side have just as much to gain in the long run. So it’s good that each participant will be invested in the success of the enterprise. ETFs and Mutual Funds

The easiest way to invest in Africa is through exchange-traded funds (ETFs) and mutual funds. Not only are these funds traded on U.S. stock exchanges, but they also contain built-in diversification and cost far less than manually building a portfolio with American Depositary Receipts (ADRs) or foreign stocks that trade on foreign stock exchanges.

The most popular South African ETF is the MSCI South Africa Index Fund (NYSE: EZA), which represents the only pure play to invest in the country. However, the SPDR S&P Middle East & Africa ETF (NYSE: GAF) also has more than 80 percent exposure to the country, which makes it a more diversified play on the country and region.

Since the rest of Africa isn’t quite as popular, there are only a few broad options to invest in the region. The first option is to purchase Middle Eastern and Frontier Market ETFs that include exposure to African countries. Since many African countries have enormous natural resources, the second option is to invest in commodity ETFs, like those focused on copper and gold.

The most popular ETFs to invest in Africa include:

Market Vectors Africa Index ETF (NYSE: AFK)SPDR S&P Middle East & Africa ETF (NYSE: GAF)MENA Frontier Countries Portfolio (NYSE: PMNA)Middle East Dividend ETF (NYSE: GULF)Frontier Markets ETF (NYSE: FRN)

The Benefits & Risks

Africa offers the highest return on foreign direct investment in the world, according to the Overseas Private Investment Corporation (OPIC) and UNCTAD. But, there are also many unique risks faced by those that invest in Africa. From civil wars to political risk, companies face a number of hurdles competing in the region’s promising economies.

Benefits of investing in Africa include:

Natural Resources: Africa has an enormous amount of natural resources, ranging from oil and diamonds to gold and uranium. And many of these natural resources remain untapped due to a low human density along with a lack of infrastructure and financing.Large Population: Africa’s population represents approximately 14.72% of the world’s total population with about a billion inhabitants in more than 60 territories. It creates a huge opportunity for consumer goods, such as telecommunications and banking.

Relatively Undeveloped: Africa remains relatively undeveloped with per capita income that lags the rest of the world. It means that there may be enormous opportunity for growth in the future as its population grows and becomes more wealthy.

Risks of investing in Africa include:

Governmental Problems:Some governments in Africa are known for their corruption or lack of policy. Corruption can lead to a number of problems, ranging from extortion to nationalizations, while the lack of policy can make it complicated to do business.Lack of Infrastructure: Africa has a low human density and per capita income, which contributes to its lack of infrastructure. It makes it difficult for companies to get electricity, roadways and other necessary components to operate in some areas.

Regional Conflicts: Africa is well known for its civil wars and conflicts, which have taken a toll on its population. Regime change can also be very difficult for companies since it causes a great amount of uncertainty.

Investors should carefully weigh the benefits and risks of investing in Africa before taking any positions. In general, it’s a good idea to only allocate a small percentage of assets to riskier regions, like Africa, to maximize risk-adjustments. I believe once African Nations start to do business with the Diaspora, it will be beneficial greatly for the region’s of African Countries that are in conflict , to some type of stability.

Stake Agreements

I am setting up a Stake Agreement Program, that allows Small Black Businesses to be able to receive Seed, VCF loans from nations in the Continent that will spearhead a new wave of African Nationalism like never seen before. It will be the new way of doing business on a World stage, where the Stakeholders are all African Peoples and the profits and training go to developing these African Nations for the sole purpose of building strong African Economies and Infrastructure, so they can compete with the economies of the world.