Africa’s journey from when it was tagged as the “The Hopeless Continent” on the cover of The Economist in May 2000 to December 2011 when the same publication put “Africa Rising” on its cover (and then “Aspiring Africa” in March 2013) has been anything but uneventful. With some of the world’s fastest-growing economies, Africa has become the newest destination for emerging markets investors. From 2001 to 2010, six out of the 10 fastest-growing economies were in Sub-Saharan Africa. The International Monetary Fund even expects another African nation to make its way into that list by next year. The economies of most African nations have grown by an average of 5-6% per year over the past decade giving momentum to the continent as a whole. (For more, see: Why You Should Pay Attention to Africa Right Now .)

Vast Natural Resources

The continent is incredibly rich in natural resources. It has huge, untapped reserves of natural gas and oil (10% of world’s reserves), and largely unexploited hydroelectric power. It’s the home to vast gold, platinum, uranium, iron ore, copper and diamond reserves. Currently, only 10% of Africa’s arable land is being cultivated, yet it holds around 60% of the world’s cultivable land. As such, Africa has become a magnet for foreign direct investment (FDI ).

Africa also has the advantage of a large, relatively cheap educated labor force. The continent is undergoing a demographic transformation with youth as its theme; there is a very high proportion of Africans in their 20s and 30s with fewer dependents – both old and young – that will play out over the next decade. (For more, see: Demographic Trends and the Implications for Investment .)

There is stability in terms of governance; the countries which witnessed terrible periods of unrest have emerged as success stories. There are better policies in place, trade has improved, and so has the business environment.

According to the UN World Population Prospects report. Africa will be the fastest-growing continent by any measure over the course of the 21st century. Investors are understandably interested.

Stocks Mirror the Economy

Sub-Saharan Africa has around 29 stock exchanges representing 38 countries including two regional exchanges. These exchanges have a lot of disparity in terms of their size and trading volume. The continent has a handful of prominent exchanges and many new and small exchanges which are characterized by small trading volumes and few listed stocks. Efforts are being put by all countries to boost their exchanges by improving investor education and confidence, access to funds and make the procedures more transparent and standardized. The table below depicts the dollar-adjusted returns (as of Sept. 30, 2014 ) of select stock exchanges in Sub-Saharan Africa (listed alphabetically ).

Market Index Returns