{"id":543381,"date":"2010-04-26T09:50:00","date_gmt":"2010-04-26T13:50:00","guid":{"rendered":"e2249889-c78b-43e3-9643-b1d7d4aa587b:428546"},"modified":"2010-04-26T09:50:00","modified_gmt":"2010-04-26T13:50:00","slug":"brazil-pegged-to-win-world-cup-africa-in-focus","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/543381","title":{"rendered":"Brazil pegged to win World Cup, Africa in focus"},"content":{"rendered":"

\"\"<\/a><\/p>\n

Brazil is the most likely winner of the 2010 World Cup in South Africa, according to UBS Wealth Management Research. The forecast is based on in-depth quantitative analysis that places great emphasis on a country\u2019s previous performance at World Cup soccer tournaments. The model\u2019s creator, UBS Chief Economist Andreas H\u00f6fert, not only correctly picked Italy as world champions four years ago, he also predicted six of the eight quarter-finalists.<\/p>\n

Almost all of the historical favourites such as Brazil, Italy, Germany, the Netherlands and England are traveling to South Africa with very strong teams. UBS says this makes it very unlikely that, with the noticeable exception of Spain, we will see \u201ca new, fancy\u201d World Cup winner in 2010.<\/p>\n

It will be the first World Cup held in Africa. While South Africa continues to be the continent\u2019s economic powerhouse, generating nearly a quarter of Africa\u2019s total GDP, the country is losing ground relative to its global emerging market peers.<\/p>\n

Predictions and football addictions aside, the UBS team felt the event warranted an investor\u2019s guide to Africa since the continent is too often forgotten when it comes to searching for opportunities. The report highlighted many issues, including the fact that Africa accounts for 15% of the global population. However, strong demographic trends are likely to push that figure up to 20% in just a couple of years.<\/p>\n

Africa also boasts the world\u2019s highest mobile phone subscription growth with some 40% of the population owning a device. A recent study showed that adding 10 extra phones for every 100 people in a typical developing country boosts GDP per person by 0.8 percentage points.<\/p>\n

\u201cThis makes the mobile phone one of the most important drivers of living standards in Africa,\u201d UBS said.<\/p>\n

Agriculture plays a huge role in Africa, with the sector making up 25% of African economies\u2019 overall economic production on average. That compares with 1% in Switzerland, for example.<\/p>\n

Despite the fact that the majority of the sub-Saharan labor force is employed in the agricultural sector, most African countries cannot provide the food they need. As a result, trade between African countries makes up only 10% of their total trade. The other 90% consists of trade with the rest of the world.<\/p>\n

China\u2019s role as a trade partner is becoming increasingly important. Africa\u2019s exports to China increased by a yearly average of 31% between 2000 and 2008, compared to 13.5% for exports to the United States. China is also boosting its foreign direct investments in Africa, due in large part to the Asian giant\u2019s hunger for commodities.<\/p>\n

\u201cWith its energy hunger, China will continue to support African commodity exporters and, in the longer term, will likely help the continent grow richer,\u201d UBS said.<\/p>\n

Africa holds an estimated 13% of the world\u2019s proven crude oil reserves and new discoveries mean that number is likely even higher. The continent currently produces 12% of the world\u2019s crude oil supply and consumes less than 4%, leaving Africa with a large surplus.<\/p>\n

While it is expect it to remain a growing source of commodity supply in the years to come, Africa has 14.7% of the world\u2019s population so it will not enjoy excessive energy reserves in the long run.<\/p>\n

\u201cAs African economies develop and grow, they too will have a bigger appetite for energy,\u201d UBS said, noting historical numbers that suggest Africa might become a net importer of oil by 2040. \u201cThus, supplying the world with non-renewable resources today comes at the cost of scarcity for future African generations.\u201d<\/p>\n

The demographics of these future generations are such that the age-groups going into the workforce now and in the coming decades will be larger than the population of children and aged dependants that they support. That means income per capita can rise faster.<\/p>\n

UBS says this is the reverse of the rapidly aging populations of Europe, the United States and Japan. The so-called \u201cdemographic dividend\u201d is also believed to have played an important role in the economic miracles of the \u201cAsian Tiger\u201d nations over the last decades.<\/p>\n

\u201cHowever, it is no done deal that Africa will be able to benefit from its shifting demography,\u201d UBS said, noting the threat HIV\/AIDS poses for the working-age population, particularly in sub-Saharan Africa. Poor education, corruption and a lack of well-regulated markets also put at risk the positive effects of Africa\u2019s demographic trends. \u201cNonetheless, demography probably remains Africa\u2019s biggest opportunity of the next 50 years.\u201d <\/p>\n

Jonathan Ratner<\/a> <\/p>\n

Photo: South African children play football in the mountains of Eastern
\nCape, 20km from Port St Johns, on November 19, 2009. South Africa is
\nhosting the 2010 football World Cup from June 11, 2010 to July 11. (ALEXANDER JOE\/AFP\/Getty
\nImages)<\/i> <\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Brazil is the most likely winner of the 2010 World Cup in South Africa, according to UBS Wealth Management Research. The forecast is based on in-depth quantitative analysis that places great emphasis on a country\u2019s previous performance at World Cup soccer tournaments. The model\u2019s creator, UBS Chief Economist Andreas H\u00f6fert, not only correctly picked Italy […]<\/p>\n","protected":false},"author":4059,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-543381","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/543381","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4059"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=543381"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/543381\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=543381"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=543381"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=543381"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}