Land of Opportunity

By Ramesh Akkineni

Jim Rogers wrote this about Africa in 1996- The best way to take full advantage of Africa, though, would be to go there and run your own farm or business. Examine your resistance to the idea for a moment, and you'll understand better why Africa is such a great buy. Don't forget: The chief characteristic of a bear market is that no one wants to buy at the bottom. Nevertheless, by the time you've built a decent house, whipped your land into shape, trained your labor force, set up communications and transportation links, and established markets for your goods, you'll be able to sell out -- if you still want to -- at the top of the coming commodities boom to some knucklehead who has more money than sense and wants to be an African land baron once it has become ultra-chic to do so.

He wrote further - Now, if you will indulge me, I'd like you to examine two countries, one in the closing decades of the 19th century, the other in the closing decades of the 20th. Both possess substantial natural resources, including fertile soils, regular rainfall, and sizable mineral deposits. But their economies have been devastated by political instability, huge debts, government mismanagement,the corruption of state officials, civil war, and difficult relations with neighbors. During these unruly decades the leaders of both countries have been periodically assassinated. Agriculture is the most important sector of the two nations' economies, employing over 80 percent of the workforce of each. But each government has recently acted to rehabilitate and stabilize its economy by undertaking currency reform and raising producer prices on exports. In the past few years, both economies have turned in solid performances based on continued investments in the rehabilitation of their infrastructures, improved incentives for production and exports, and gradually improved domestic security. The rest of the world, however, still sees both countries as rude and barbaric.

If at the end of the 19th century you'd emigrated to the first, you'd have come to the United States, where you had a chance to make a tremendous fortune, as did a tidal wave of immigrants. If today you emigrated to the second, you would be investing in Uganda. This African nation is supposed to be the worst ofthe worst, the former fiefdom of the blood-drenched cannibal Idi Amin. But it is now a beacon of capitalism. Since Idi Amin left in 1979, Uganda's exports have increased hundreds of times despite the horrible bear market in commodities during this period. This leap is just the beginning of the story.

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