The following appeared in the November issue of Business Diary Botswana:

Despite the IMF’s recent projection that Botswana’s economy will contract 10.3% this year, the lender expects a 4.1% uptick next year such that emergency funding would not be required. Back in June the country tapped a $1.5bn “budget support loan” from the African Development Bank–the largest such facility ever granted by the Bank–in order to finance part of a budget deficit then estimated at around 13.5% of GDP, and since revised to 14%. The IMF cited a renewal of demand for diamonds as a central facet of its optimistic forecast. Furthermore, it predicted, GDP growth across sub-Saharan Africa will rise to approximately 4% next year and 5% in 2011, up from 1.1% in 2009. “We think it should be possible for sub-Saharan Africa to recover quicker this time around and have a ‘V-shaped recovery,’”

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Regular readers need to accept my sincerest apologies…updates for the next week will be rather itinerant due to a taxing MBA orientation schedule.

In the meantime, I’d like to mention that Silk Invest CIO Daniel Broby, a friend of the blog whom I consider to be an (the?) authority on frontier market investing, will be presenting a paper entitled “The case for frontier market fixed income” that he co-authored along with Silk’s Director of Fixed Income, John Bates, at the “Challenges of Globalising Financial Systems” conference to be held at the Hashemite University in Jordan on October 21-22, 2009.

The paper, which Daniel allowed me a sneak preview of, and surrounding which Mr. Bates was kind enough to answer some of my questions, posits that frontier fixed income “should be included in strategic asset allocation using a technique known as reverse asset allocation,” in order to benchmark the

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London-based Silk Invest Ltd just announced the successful launch of both its Luxembourg domiciled African Lions Fund and Arab Falcons Fund (see charted performance against relevant indices hitherto below).  Per one report, the new funds are being aimed at European fund of fund managers (though the firm ultimately seeks to target “more traditional investors such as pension funds”), and will be capped at $500m.

Touting the funds, Silk CIO Daniel Broby noted that African and Arab countries “have restructured their economies and are best positioned to profit from the next stage of globalization.”  Further, he added, “we have a generational opportunity in frontier markets; industrialization is coming to the final places in the world where it hasn’t come yet – namely Africa and the Arab world.”

Both funds will limit exposure to individual countries as well as individual sectors to 25%. Broby remarked that the African fund ...

a href="http://4.bp.blogspot.com/_vp8WdjtxYc0/Scue9KxCDVI/AAAAAAAAARU/rdrFscwaCiA/s1600-h/euromoney.jpg"img style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;width: 280px; height: 218px;" src="http://4.bp.blogspot.com/_vp8WdjtxYc0/Scue9KxCDVI/AAAAAAAAARU/rdrFscwaCiA/s400/euromoney.jpg" border="0" alt=""id="BLOGGER_PHOTO_ID_5317518558740221266" //abr /Finance Minister Uhuru Kenyatta joins Daniel Broby and others at the opening panel of the Euromoney Kenya conference.div class="blogger-post-footer"img width='1' height='1' src='http://res1.blogblog.com/tracker/3742382075154765669-3009496307086369014?l=danfonds.blogspot.com'//div

Daniel Broby is currently visiting Silk Invests South African office. He reports that the South African market appears to be 'relatively' resilient in the face of the global slowdown. That said, the JSE fell yesterday and today following six days of gains and the mood is deteriorating. Industrials are statring to experience negative sentiment. Arcelormittal reoported a decline in factory output and this only reinforces the message that manufacturing data has been in decline for two months now. br /br /The rand is likely to remain vulnerable to risk aversion.

Daniel Broby, Chief Investment Officer of Silk Invest, will speak at the Asian Frontier Markets 2009 - Hong kong.br /br /5 March 2009 - Day 1 br /Macro view on Asian Financial Liberalization br /Understanding Vietnam’s Market Fluctuation br /Frontier Market in the context of Global Financial Crisis br /Panoramic view on Cambodian Market br /Investment Strategies in Frontier Market br /Mitigating Idiosyncratic Risk in Frontier Market br /Encouraging better investments in Bangladesh Market br / br /6 March 2009 - Day 2 br /Positive positioning: Asian Frontier Markets in attracting Foreign Investors br /Exploring the potential of Capital market on pre-emerging countries br /Evolution Hedge Funds in Frontier Market br /Kazakhstan: Leading Central Asia market br /Most preferred Asset Class in Frontier Market by Mainstream Investors br /Forecasting Asian Frontier Market br /Lessons Learned: Investment Strategies in African Frontier Markets

This video from Daniel Broby of Danfonds SPC does a superb job of pointing out the extraordinary investment opportunities within key frontier markets, especially in Africa. He points out, however, that the rewards come with potential geopolitical risks — thus the need for dealing with specialists. Such investing is not for the faint of heart.

Analysis by Daniel Broby of Danfonds SPC

Financial NewsJason Corcoran24 June 2008 Renaissance Investment Management's leading wealth management executive is leaving the Russian fund manager to join Swiss private bank Lombard Odier Darier Hentsch in Geneva.Alexander Kotchoubey, who joined Renaissance Investment Management as wealth management head and deputy chief executive, is the fourth senior executive to leave the Moscow firm in six months and follows the departure of its president Ilkka Salonen in May, chief investment officer Daniel Broby in March and the head of its Swiss operation Philippe Magistretti last December.Kotchoubey will join Lombard Odier in the next couple of weeks as head of international development for Russia and Eastern Europe.He said: "We are in the process of building a team for the region based in Geneva. Lombard Odier recognises the opportunities of expanding its franchises in emerging markets. They have a very aggressive view ...