Nigeria is part of the EAGLEs (emerging and growth-leading economies), whose contribution to world economic growth in the next ten years is expected to larger than the average of the G6 economies (G7 excluding the US).
I have also asked for a similar ETF from Global X, but for Greece. Just voted on this, would appreciate if you could do the same here.
Thanks.
I’d really like to find a way to invest in Africa - specifically Nigeria and Ethiopia. There don’t seem to be any such ETFs on Freetrade and no companies from those countries either (that I know of).
Does anyone share a similar interest ?
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Great post @CashCow! It would be great to have more Africa, or indeed frontier market focused ETFs on Freetrade.
FWIW on the countries you mention specifically some thoughts and observations:
Ethiopia is challenging as the economy is still largely dominated by state owned enterprises, though it is slowly opening up to foreign investment, it’s going to be a bit of a journey, albeit an exciting one for this amazing country. Priority sectors for development will be geared towards export; think power, manufacturing and agribusiness, but as the country suffers from a chronic hard currency shortage so the opportunity to access this will be limited to development capital and frontier investors. Specifically on opportunities, Ethiopian Airlines is one to watch.
Nigeria is really interesting, but not for the faint hearted. Its reliance on oil and gas has long been a drag on the country’s development and the current collapse in oil price is going to hurt the country severely, in particular the financial services sector, as it has significant exposure to oil and gas. There’s a clear correlation to a fall in oil price with increased NPLs, which means banks, so vital to driving private sector growth, will retrench and limit the credit they offer, hurting businesses and consumers further. Nigeria has also suffered from several headwinds (and low growth by African standards) over the past several years which has pulled equities down. Unfortunately, Covid-19 will only make matters worse over the short to medium term and given the limited means the country has to weather this, political risk is acutely high.
I think both these of these countries offer some interesting opportunities over the longer term, notwithstanding their ability to come out of this relatively intact. They have demographics and strategic importance (as it stands) in their favour.