BRIC countries have re-defined Africa's role in the global economy, says STANLIB

BRIC involvement in Africa is no 'flash in the pan.'

London - 29 June, 2009 -- BRIC countries (Brazil, Russia, India and China) and not the developed economies are re-defining Africa's role in the global economy, a direction which is being driven by solid commercial needs and common interest, according to research by STANLIB, the US$45bn Johannesburg based asset management operation of the Standard Bank of South Africa.

China has led Africa's economic transformation, having come to appreciate the vital role the continent would have to play in its own development 10 or more years ago. The relationship is such that by 2008, Africa was receiving 30% of China's entire bi-lateral aid budget. Since 2003, China's President, Hu Jintao, has made official visits to Africa every year, a diplomatic offensive unrivalled by any other world power. This week's acquisition of Addax Petroleum by China's Sinopec represents China's largest foreign investment in the energy sector to date and while Addax's interests in Iraq have claimed the headlines, 100% of Addax's production in 2008 was sourced from Nigeria and Gabon, making the deal essentially a further Chinese investment into Africa.

Russia's involvement appears to be geo-politically motivated and as a result its activity has been focused on the energy sector, specifically oil, gas and uranium. Russia currently supplies 20% of Europe's natural gas and recent moves to secure additional supplies destined for Europe in Libya, Algeria and Nigeria suggest its ultimate intention may well be to increase its bargaining power with the West. In an interesting extension of this theme, Russia is reported to have been showing interest in securing uranium supplies from Namibia, now the world's fourth largest producer of this vital element in the production of nuclear power.

India's interest is more clearly commercial. While total BRIC-Africa trade now stands at $157bn, India has set an objective to bring its own individual trade with Africa up to $150bn by 2013. Although one of India's key priorities has been to diversify its oil supplies from Africa and away from the Middle East, Africa-India trade covers a broad range of technological and manaufactured products, facilitated by Africa's sizeable population of Indian origin.

Brazilian involvement in Africa is perhaps the least well recognised but it has been growing steadily. Astonishingly, over 45% of Brazil's 198mn population claim direct African descent with strong linguistic and cultural links with Angola and Mozambique specifically, courtesy of their earlier joint ties with Portugal. To date, Brazil's activity in Africa has been highly focused on the energy sector, in particular bio-fuels, in which it has particular expertise. Over 75% of all new Brazilian cars now run on a mixture of petrol and bio-fuels.

Commenting on this investment in Africa's development, John Mackie, Head of African Funds at STANLIB says:

"Given that the BRIC economies are the fastest growing in the world and on a medium term view are likely to equal the importance of the world's developed economies, Africa is positioned to play a pivotal role in that development for the foreseeable future.

"Africa is both a large and fast-growing consumer market and a vital source of growth – enabling BRIC-African trade to increase from $16bn in 2000 to a staggering $157bn in 2008 (a compound annual growth rate of 33%) demonstrating that this no mere 'flash in the pan'."

To see the full research piece by STANLIB's Group Economics' team. Please see attached document.

About STANLIB

Standard Bank is South Africa's largest bank (and a FT Global 500 Member) and is Africa's largest financial services company, with operations in 17 African countries. STANLIB is South Africa's 3rd largest asset manager with US$45 billion of assets under management and has been managing money there since 1969. STANLIB's Africa Division, which will manage the Standard Africa Equity Fund, has been managing money in African countries beyond South Africa's borders since 1995 and now has stand-alone operations in Botswana, Kenya, Lesotho, Namibia, Swaziland and Uganda, manages mandates in Mozambique and the Sudan and has West and North African specialists based in Johannesburg.

For further information, please contact:

Clare Milton / Andrew Lyons
020 7786 4874 / 4818
Penrose Financial

Dylan Evans
020 7815 3083
Global Investment Marketing Director
Standard

This document has been approved for the purposes of section 21 of the Financial Services and Markets Act 2000 (FSMA) by Standard Bank Plc, which is authorised and regulated by the Financial Services Authority.

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