Date: 4.16.01
Andrew Young knows every argument for not investing in sub-Saharan Africa. He sees huge opportunity anyway.
For a preacher, Andrew Young, 69, reveals surprisingly pragmatic views: "I believe in feeding the hungry not by prayer or politics but by enterprise." Young joined us for lunch at a club in Atlanta, Georgia, to talk about investing in Africa, not a popular mission these days. For most of his life he has put his faith in God and government, but Young now believes in the power of business: Africa's salvation, he says, lies in private enterprise.
It's a striking stance for a minister who was ambassador to the United Nations, a three-term U.S. congressman, a two-term mayor of Atlanta and the right hand of Martin Luther King Jr. in the civil rights movement. In the Carter Administration, more than 20 years ago, Young drew fire for his provocative pronouncements on Middle East politics, yet we quickly discover that today he is averse to confrontation and modest.
Since leaving politics in 1990 Young has spent much of his time helping companies explore opportunities in sub-Saharan Africa, where he has high-level contacts. Past or present clients include Enron, Coca-Cola, Monsanto and Chevron. In 1995 President Clinton appointed him to head a $100 million entity called the Southern Africa Enterprise Development Fund, but his experience was at times painful. So far, about half the money has funded Namibian ostrich farms, Zimbabwean truck lessors, Zambian pork processors, African broadcast networks and a dozen other ventures.
The outcome? "Maybe a C minus," Young says, grading himself. "We plunged into a very difficult economy and, frankly, didn't know what we were doing." The fund was saddled with a heavy social agenda, which often hampered its performance, he says. It invested in a community hospital in Cape Town, where the doctoring is excellent but the financial results poor.
"As a preacher, trying to tell people there's enormous business potential in Africa‹well, I was talking to the wind," he says. In 1997 Young turned to the private sector, starting a consulting firm, GoodWorks International, to anchor his efforts.
It has been a struggle. In 2000 all of Africa received just $10 billion in private foreign investment. (Latin America and the Caribbean attracted $70 billion.) Political instability, corruption, mind-numbing bureaucracy and populations dying from war, hunger and disease don't add up to the friendliest business climate.
As a magnet for business, Africa might seem a joke, but Young will have none of that. "Despite all the turmoil, Africa is too vast to be painted with a broad brush, and there are areas of great opportunity," he patiently intones. We ask him for his top three countries after South Africa, which is already well known to U.S. investors. He doesn't miss a beat:Angola, Botswana, Nigeria. "Angola," he says, "is so rich in resources, it's like California before the gold rush. Almost any investment decision can make money. There's gold, diamonds, oil and gas, all in abundance."
He continues: "Botswana has a stable democratic government, a budget surplus of $1 billion from profitable diamond mining and a manageable population of just 1 million. There's an abundance of wildlife that has great potential to attract tourism, and the government is able to co-invest with foreign business partners."
Nigeria is next‹a country recovering from one of the continent's most corrupt governments. President Olusegun Obasanjo was democratically elected two years ago and is trying to curb corruption and pave the way for new foreign investment in power generation, trucking and mining. "You could make a killing in poultry production," Young adds, smiling at his apt choice of words.
There's more. "Anywhere in Africa, telecom is a good business‹80% of Africa is untapped for wireless services," says Young. But shouldn't running water come before voice mail?"Not necessarily," he says. Africans can buy cellular phones, and they do. In South Africa, workers buy them for their mothers in distant villages so they can keep in touch. Running water, on the other hand, requires government, and in Africa the governments are notoriously inefficient or corrupt.
Ask Dyan | Curriculum Vitae | Forbes Articles | Graphic Novel | Jokes | Machan Auction | Nice Things Said About Dyan
Pictures of Dyan | Quotes | Screen Treatment | The First Article I Published | What is a Machan? | Home