This Week on the Frontiers: Ethiopia’s Appeal Grows
Ethiopia has been generating a great deal of interest from potential investors. At a PAN Africa Network event in New York this week, panelist John Saunders said U.S. investors on a recent African tour singled out Ethiopia as a country that has positive fundamentals and good investment opportunities. Saunders, a managing redirector at Deer Isle Group, a New York-based broker-dealer, told WSJ Frontiers: “[Investors] are comfortable with their existing Ethiopian exposure and even interested in Ethiopia-specific funds to increase it.”
Matt Vogel, head of emerging- and frontier-market strategy at Dubai-based fund manager Duet, also sees increasing enthusiasm for Ethiopia, although the investment opportunities for public-equity investors are still limited. “People are excited about it. The outlook is great and the prospects for the country’s growth rates are pretty jaw-dropping, but it seems like more of a private equity story right now,” he told WSJ Frontiers in an interview that we will publish next week.
The country still faces considerable challenges, though, says consultancy Business Monitor International, which predicts that Ethiopia will “become increasingly ungovernable” if democratic reforms don’t occur. “Ethiopia will effectively remain a one-party state following the May 24 general election,” BMI says, which will increase the already substantial pressure for reform as well as the potential for politically inspired violence.
Source: Wall Street Journal