| Africa |
Team work Economic harmonisation between African jurisdictions is paving the way for a more unified market. And, as South Africa prepares to host the Fifa World Cup, LB analyses the region’s strengthening investor profile. By Anastasia Hancock and Maria Jackson
The past year has been a uniquely tough time for the world’s financial markets but, as in all recessions, there are opportunities for the more nimble players to create a new world order. Among the emerging markets, African countries have been too often overlooked in favour of the more stable political economies in South America, Asia and eastern Europe, but that may be about to change. In September 2009 The World Bank published its annual ‘Doing Business’ report, a guide that tracks government legislation to identify the world’s most business-friendly countries. There was a major surprise. Rwanda was named as top reformer, following a year of business-friendly policies concentrating on tax, employment and start-ups that saw it jump a mammoth 76 places to 67 in the overall rankings. This was the first time a sub-Saharan African nation was named the leading reformer since The World Bank established the report in 2003. It’s no coincidence that Rwanda has been heavily involved in the development of two geographical communities, the Economic Community of Central African States (ECCAS) and the East African Community (EAC), which aim to promote economic co-operation. The growing emphasis on economic harmonisation between African countries and the profile given to Africa in the lead up to the 2010 Fifa World Cup has seen its attractiveness to investors skyrocket. Herbert Igbanugo, founding shareholder of Igbanugo Partners Int’l Law Firm, a Minnesota-based firm that specialises in international trade law in sub-Saharan Africa, suggests that the current performance of Africa’s economy equals a 30% to 50% return on investment. It’s an astonishing figure in the current financial climate, and a statistic that should have firms flocking to the region. Once markets become more mature, harmonisation will make investment returns more consistent. Encouraging the harmonisation process is the fact that many areas of Africa share languages. Francophone Africa is perhaps the most immediately obvious, but the Portuguese also have strong links to the continent. To read the rest of this article subscribe to Legal Business. 
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