As the number of wealthy individuals in Africa grows, I wonder if the US will see more public investment from such individuals. For example, Tony Elumelu invested an undisclosed amount in a California-based satellite startup last year. Will we see more folks follow the lead of, say, the Qatari government which gave around $100 million towards Hurricane Katrina recovery efforts in Louisiana. The pharmacy school building at Xavier University is now called the Qatari Pharmacy Pavilion. A $100 million investment may be a bit steep for an African government or individual, but not totally out of reach. Aliku Dangote made waves during the US-Africa Leaders Summit when he announced an investment $1 billion in Nigeria’s rice market, and a 50/50 co-investment with the Blackstone Group of $5 billion in Sub-Saharan Africa’s energy infrastructure.
The EB-5 visa program has been a popular vehicle over the past several years for wealthy individuals from around the world to secure residency in the US. Investors commit to placing a minimum of $500,000 or $1 million (depending on the location) in an enterprise that creates at least 10 full-time paying jobs. Real estate projects seem to be the most popular targets for these investments. Regional centers registered with the US government market these projects to aspiring visa-holders and pool the funds. Chinese investors have been the heaviest users of the program, often due to the specter of crackdowns from the Chinese government’s campaign against corruption in the country.
I understand that the program has been used pretty regularly by African investors. It would be interesting to see a breakdown of where EB-5 investors are coming from on an annual basis. There’s not much recent data on the program, but it is facing scrutiny this year due to some cases of fraud. I imagine that data on the program will emerge from Congressional hearings on its efficacy. Something to watch.