Having demonstrated resilience during the global financial crisis, Africa’s emerging market countries have good prospects for 2011.
Foreign direct investment, particularly from Africa’s new trading partners in Asia, is expected to strengthen and demand for African bonds is set to increase.
Such diversification of financing sources for much-needed public investment would be welcome, but would also require a coherent macroeconomic policy and foreign exchange regime to cope with capital flow surges, especially if they have historically been prone to debt problems.
More private capital ahead
Advanced-industrial-country policy measures, albeit needed to shore up their own growth prospects, have led to historically low yields and, in some cases, significant increases in public debt. These trends, coupled with strong growth prospects in many emerging markets, have led investors to look further
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