Africa's Emerging Markets Shine with 42.2% Growth in 2025

In 2025, emerging and frontier markets, particularly in Africa, significantly outperformed developed markets, with the MSCI Emerging Frontier Market Africa ex-South Africa Index increasing by 42.2%. Rori Kutisk Jacobson, a fund manager at Allan Grai Africa ex-South Africa Equity Fund, expressed cautious optimism regarding future performance, noting that while the past three years showed strong returns, the upcoming years may not replicate this success due to historical volatility.

The S&P 500 and MSCI World Index delivered returns of 17.9% and 21.1%, respectively, while the MSCI Emerging Market Index rose by 33.6%. Notably, Delta Corporation in Zimbabwe and Eastern Tobacco in Egypt are highlighted for their strong performance, with Delta Corporation generating significant free cash flow and trading at an attractive price-to-earnings multiple.

Allan Grai's fund has substantial exposure to four major banks, including Guaranty Trust Bank and Zenith Bank, which are expected to perform well given their fundamentals.