Franklin Templeton, a global investment manager with specialized expertise across key areas, has set up an African fund to be managed by Mark Mobius, the executive chairman of Templeton Asset Management Emerging Markets Group.

The fund will aim for long-term capital growth by investing in African-listed equities or companies based elsewhere but with principal business activities in Africa. Details of the charges are not yet available.

Templeton Emerging Markets Group Executive Chairman Mobius says: “We believe that Africa’s markets present significant opportunities for development due to a combination of strong economic growth, rising demand for the region’s vast natural resources and a growing consumer market.”

Adding, “Africa is expected to grow more than 7 per cent annually in the next 20 years due to an improving investment environment, better economic management as well as emerging markets’ rising demand for the continent’s resources, all of which offers a compelling zproposition to global investors.”

Furthermore, Mobius said, “We believe that African markets present a significant opportunity for development due to the combination of strong economic growth, rising demand for region’s vast natural resources and a growing consumer market.”

He believes that Africa has impressive stores of resources, not only in minerals but also in agriculture- 60% of the world’s uncultivated arable land is found in Africa.

“Demographically, Africa’s growth should benefit from relatively young population with rising purchasing power. The median age of the African population is 20, compared to 40 in the developed world, and it is estimated that in 10 years, the number of African households more than $5,000 will jump from85 to 128 million,” Mobius said.

However, a senior analyst says: “Africa funds can offer good diversification in terms of emerging market exposure for investors. However, it is a specialist product and so will not be suitable for every retail investor.”