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
- Forums
- ASX - By Stock
- far suck of the saveloy
WilliamI agree with you on Sovereign risk. It is of course a...
-
- There are more pages in this discussion • 5 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add SDL (ASX) to my watchlist
Currently unlisted public company.
The Watchlist
LPM
LITHIUM PLUS MINERALS LTD.
Simon Kidston, Non--Executive Director
Simon Kidston
Non--Executive Director
SPONSORED BY The Market Online