far suck of the saveloy, page-10

William
I agree with you on Sovereign risk. It is of course a concern. I've cut and pasted a small part of a report on Cameroon put together by the Financial Times.

See below which is from the FT's website.

"Economics

Inflation 4.9% p.a. (1990–2001)
• Gross National Product (GNP): $8.75bn
Score card
• World GNP ranking: 93rd
• GNP per capita: $550
• Balance of payments: –$147m
• Inflation: 2.8%
• Unemployment: 30%


Economic performance indicator

Strengths
US companies exploiting oil reserves. Chad–Cameroon oil pipeline project. Very diversified agriculture includes timber, cocoa, bananas, and coffee. Self-sufficiency in food. Strong informal sector. Private sector in relatively good state. Electricity production is 97% HEP.
Weaknesses
Massive fuel smuggling from Nigeria affects refinery profits. Inflated civil service. Widespread corruption."

Note the last sentence.

On a positive note there are many other companies operating succesfully in this part of the world including US and UK companies. Partners in the oil pipeline that carries oil from Chad through Cameroon include Exxon Mobil, Chevron and Petronas.

On the currency side of things I think it is too early to determine what risks there will be. I'd imagine that any deal will be struck in US$ or AUD$ which are both highly liquid and hedgeable(not sure if that is a word!) currencies.

I hope this provides a balanced view.
cheers
Belkin