NAIROBI, 25 April 2012-As the date of ATI’s 3rd Annual Roundtable draws nearer, we decided to profile some of the personalities who will be participating in this annual event. The Roundtable provides a platform for Africa and its partners to have an honest dialogue about the existing political and trade risks and their impacts on trade and investments – and more importantly participants discuss practical ways of moving the continent’s risk profile into a more positive direction. Africa is growing into a profitable destination for investors and others who are seeking new opportunities. If the continent is to reap the full advantages of this interest, how the world views African risk will become increasingly important.
Given the impact of Africa’s shifting demographics, this year the theme is on “Empowering the Youth Revolution” precisely because Africa is projected to become and maintain the status for decades to come of the youngest continent on earth. A majority population under 40 will pose challenges and opportunities which the panels will address.
Neil Gosrani, profiled here, is an Associate Director within the Financial Institutions Ratings division at Standard & Poor’s. Neil joined Standard & Poor’s in July 2007 and is the lead insurance analyst for Africa. In this year’s Roundtable he will deliver a presentation in the panel on Managing Risks in Turbulent Times: Prospects for Africa and the Middle East in the Wake of the Arab Spring.
In his own words, here are his views on Africa’s risk profile.
1. What is your professional background?
I began my career as an executive trainee with HSBC. Latterly, I chose to specialise as a relationship manager for European insurers in the bank’s Corporate and Investment Banking division. From there, I joined Standard & Poor’s in order to focus on insurance analysis and now focus on insurers in emerging markets, specifically Africa and the Middle East.
2. Where in Africa have you worked and in what capacity?
Although I have not worked in Africa, I’m a regular traveller to a number of countries across the continent.
3. In your opinion, what are some of the greatest business risks that those interested in investing or working in Africa face today?
Political and economic risks across the continent are well documented, with some countries having significantly higher levels of risk than others. Businesses face risk in the under-developed nature of much of Africa, from a weak legal framework, transparency, official red tape, infrastructure, a suitably skilled workforce and the like which make doing seemingly simple things difficult and time consuming. Indeed, Standard & Poor’s incorporates such factors into its ratings, both at sovereign and individual company level.
For an insurer, finding data to to ascertaining the demand for its services or to underwrite business can sometimes be difficult. In addition, finding suitable assets locally to invest surplus funds can also be problematic.
4. Is there a difference between Africa’s risk profile and the perception of risk that those outside the continent may hold about doing business here – please explain?
Yes. The perception of those not familiar with the continent may be negative if they use general news coverage, which has a tendency to focus on ills, as a proxy for their assessment of risk. This is likely to lead to their perception of risk being elevated. On the other hand, once one becomes better acquainted with Africa, a more balanced picture emerges with both positives and negatives taken into account.
5. How does Political or Trade/Commercial Risks impact on your business or profession?
In our analysis, political risk is one of the many factors we must consider when evaluating a company’s business and financial profile.
6. What could Africa do differently or more of to positively alter its risk profile around the world?
Improving the risk profile plays partly to one’s perceptions as well as reality on the ground.
The perception part refers to Africa’s need to change the world’s current received wisdom on the continent (such as disease, war, poverty, famine and corruption) with some of the positives such as a young, energetic, multi-lingual, resourceful and entrepreneurial population keen to create a better life.
The reality part refers to what needs to be done. Showing leadership by creating a stable operating environment and tackling some of the difficult issues that persist such as improving infrastructure, governance and transparency or reducing the likelihood of conflict and disease.
7. What attracted you to participate in this Roundtable?
The opportunity to discuss the important issues affecting Africa with a wide range of influential people.
8. What do you think a Forum like this can achieve?
A greater awareness and understanding of the reality and perception of risk across the continent as well as the opportunity to hear a variety of views.
9. What do you hope to contribute to the discussions?
Hopefully, analytical insight from my work across Africa and the Middle East as well as through exposure to global developments at S&P.
10. What are your predictions (i.e. economic, political, social) for Africa in the next 10 years?
My prediction and hope is that Africa presents the next great emerging markets opportunity. Realising this opportunity will positively benefit both the continent and its citizens.
