Saturday, February 22, 2014

Trendy "Frontier Markets" are just as exposed to slower Chinese growth as the BRICs

Duh.  Before Africa became popular with institutional investors looking for “uncorrelated” equity markets, mining was the business of Africa.  And guess what?  It still is.  Yes, there’s a booming consumer class but this was an effect of the mining boom, not some organic happening.  Africa will require real, meaningful, painful economic and financial reforms before there will be rapid growth.  Nigeria’s sacking of their widely respected and successful central bank head is just one data point suggesting these reforms may be a long way off.  This from Africa Report on the mining sector is grim reading:

Mining: Precious little to celebrate


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