Top 10 Reasons Why Private Equity Should Invest in Africa?

Private Equity is preferred by a large scale of investors due to the sky-high salaries, better profits and rewarding investments. The major factor in such investments is the potential for returns. Keeping that in mind, here are 10 reasons to invest in opportunities in Africa:-

1.) Stable growth

Africa has shown a certain level of stability in the last decade. Their growth rate has been constantly rising and African countries have also displayed a lot of potential. Individual economies have revealed sources for good returns on private equity investment.

 

2.) Population proportional to opportunity

The African population is annually growing at 2.5%. In the next few years, a lot of manpower will be available, which can be trained and invested into for future returns in multiple sectors.

 

3.) Population Division

Middle-class people constitute approximately 30% of the African population. Private equity is looking forward to establishing businesses that can identify this bracket of the population as their customers and create sales as well as job opportunities.

 

4.) Legalities

Africa is soaring in the rankings of ‘Ease of Doing Business’. This alone has attracted many investors to examine the unidentified potential. Furthermore, reduced complexity of legalities promotes transparency in business and helps to build trust

 

5.) Abundant natural resources

According to experts at Quantum Global Angola, industries associated with manufacturing and extraction have a great scope in Africa. This is due to the fact that almost every country in Africa has a distinctive mineral form, which can be synthesized and used to reduce costs marginally. (Also read: Top 10 Influential Africans who are driving change in the continent)

 

6.) Urbanization increases opportunities

Infrastructure and transport are in dire need of investments because they are not at par with the rate of African urbanization. The disoriented scales of housing and population growth ratio are a potential avenue for private equity giants.

 

7.) Potential in infrastructure

Africa’s infrastructure industry is trying to meet its financial requirements with banks and pensions of small scale. In reality, it is almost $50 billion short of its ideal finance figure. Such a large deficit cannot be met without private equity funding, and growing population supports the argument of good returns.

 

8.) Social avenues

Increasing population demands more facilities in the city, especially health-related. The common people of average financial strength are struggling with diseases. Adequate care facilities, hospitals and doctors are nowhere sufficient. A hefty investment from privates can be instrumental in generating profits as well as increasing the African standard of living.

9.) Technology

Quantum Global Angola has always promoted innovation in Africa and they have been working for a long time to draw investments in the same sector. Mobile services in Africa have established their market in the banking sector, but there are a lot of avenues like insurance, transport, etc., with the ability to generate substantial profits.

 

10.) High Credit Ratings

Improved credit ratings of African countries have reflected a friendly environment of management and politics. Companies factor such developments and become more willing to invest in Africa with reduced risk and limitless avenues.

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