A lady named Elisabeth Kubler-Ross was a psychiatrist who devoted herself to researching what happens after death. She is best known for her model detailing the five stages of grief: denial; anger; bargaining; depression; acceptance.
Kubler-Ross's process has been adapted by psychologists into four stages that all humans apparently need to move through before embracing change: first it's denial, then rejection, followed by acceptance, then finally commitment. When it comes to global and specifically investor sentiment of Africa, I feel most of the first world are currently at the transition from rejection to acceptance. Those ahead of the curve (like Wal-Mart and General Electric) are either at acceptance or full blown commitment.
Dark continent no more
Africa has long been looked at as the dark continent: the place where dictators, disease and corruption are rampant. Yet there is genuine reason for (cautious) optimism. Professor Klaus Schwab, founder of the World Economic Forum, said at the forum's gathering in Addis Ababa last month that his perception of Africa has shifted over time from cynicism to pessimism, on to realism and now pragmatic optimism. At this forum the head of the China Investment Corporation said Africa today reminds him of where his country was in 1980 and is on the same growth trajectory. Another podium occupier described Africa as being where Brazil (the world's seventh largest economy) was in 1974.
Many don't know that South Africa has become a member of the BRIC group consisting of Brazil, Russia, China and India. While the addition of South Africa to make the term BRICS has been described as a politically motivated gesture by China, there is no denying that South Africa along with other places like Nigeria, Ghana, Ethiopia, Kenya and yes, war-torn Rwanda present growth opportunities that cannot be found in the highly competitive and saturated economies of the first world.
The CEO of Lonrho, a London Stock Exchange listed company active in agriculture, hotels and transport in Africa, remarked that while executives in Europe and North America work on strategies to gain 1% market share gain from competitors, the challenge in Africa is how to manage growth of 30% per year.
It's far from the land of milk and honey, but there are opportunities which exist in Africa that are simply not available in places like Europe, North America or Japan.
With China already steaming ahead for many years and talk of a "hard landing" coming up for them, and with India yet to find its rhythm, Africa presents opportunities that any true global investor or entrepreneur cannot ignore. This is not about investing in Africa out of charity, this is about investing in Africa because it makes economic sense. The question of investing in Africa is no longer an issue of whether Africa is ready or fit for it; rather the question is whether investors and entrepreneurs can migrate their thinking past the above four stages and change their perception from undue cynicism to one of pragmatic optimism.