Financial Investment in Africa

Extracted 25AUG2011 from

Fusion Capital, which is part of UK-based Fusion Investments, is putting $150 million to work in small and medium-sized businesses across Africa, Reuters reported. The fund – known as Fusion African Access – began investing in March and aims to deploy the entire fund by the end of the year. It invests between $250,000 and $5 million per company.

With the integration of Rwanda, Burundi, Uganda, Tanzania and Kenya into a common market of 133 million people and combined GDP of $75 billion, the region has been attracting private funds.

Small and medium-sized enterprises are estimated to contribute about 40 percent of Kenya’s gross domestic product (GDP) while returns from real estate investment outpaced those from investments in Kenyan shares in the decade from 2000.

Phil Godwin, Fusion Capital’s chairman, said there were some risks for investors. “Country risk, politics and currency volatility are a fact of life in frontier markets,” Godwin told a launch ceremony.