Emerging Africa and The Middle East David Sanders, Chief Investment Officer Luxembourg Forum, April 26, 2012

Who is Invest AD

Abu Dhabi Investment Authority (ADIA)

Abu Dhabi Investment Council (ADIC)

International Petroleum Investment Corporation (IPIC)

Mubadala Development Company

Invest AD (Abu Dhabi Investment Company)

2

Abu Dhabi Sovereign Wealth Funds

Invests Abu Dhabi’s surplus revenues into financial assets abroad, thus providing capital diversification for the emirate’s economy

Created out of ADIA in 2007, and fulfils a similar role, although it has a greater focus on investing in the Middle East region

Invests mainly in foreign oil and energy companies, focusing primarily on downstream activities

Mandate to drive the diversification and development of the Abu Dhabi economy

Invests in Middle East and emerging Africa. Uniquely among sovereign entities, offers these investment opportunities to third-party clients

Partnerships Discretionary

mandates

Active, fundamentally

driven strategies:

− Emerging Africa Fund

− GCC Focus Fund

− Iraq Opportunity Fund

− Libya Opportunity Fund

Passively managed funds

− UAE Total Return Fund

White labeling

Sub-advisory

JV partnerships

Partners include:

– SBI Holdings (Japan)

SBI Africa Fund

– BHF Bank (Germany)

Frankfurt-Trust Emerging

Arabia Fund

– Quam (Hong Kong)

Quam Middle East Fund

– Al Hilal Bank (UAE)

Al Hilal GCC Equity Fund

Tailor-made solutions

for Institutional or HNWI

Investors

− Regional or

country specific

− Active or passive

− Conventional or

Shariah compliant

Middle East &

Emerging Africa funds

3

Asset management offering tailored to client needs

Fundamentals

4

From Frontier to Emerging

Opportunity is growing Rapid economic development

Rich in natural resources

Growth in personal consumption

Compelling valuations

Less correlated to other global markets

Political short-term volatility, medium-term opportunity

Perceptions of risk are changing Legal, government institutions improving

Public pressure against corruption

Political change mostly peaceful

Markets young but developing

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Africa and Middle East underperformed in recent years

Risk/return over last three years

Source: Invest AD Research - Zephyr Style Advisor data for Jan 2009 – Dec 2011

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January 2009 – December 2011 ( Single Computation)

• MSCI EFM AFRICA ex ZA

• S&P 500

• MSCI AC ASIA

• MSCI EM (EMERGING MARKETS)

• DJ Eurostoxx 50 Index

• S&P GCC LMC Index

Market Benchmark: MSCI World Index

Cash Equivalent: Citigroup 3-month T-bill

Standard Deviation

Retu

rn

But rapid growth expected in coming years

GDP growth 2011-

2015 (CAGR)

Iraq 10.8%

China 9.5%

India 8.2%

Ethiopia 8.1%

Mozambique 7.7%

Tanzania 7.3%

Vietnam 7.2%

D.R. Congo 7.0%

Ghana 7.0%

Zambia 6.9%

Afghanistan 6.9%

Nigeria 6.8%

Excluding countries with less than 10 million population. Eg. Qatar forecast GDP growth of 8.4% 2011-2015 CAGR

World’s fastest growing economies 2011-2015

Source: IMF January 2011 7

Qatar Saudi Arabia

UAE

Egypt Morocco

Ghana Nigeria

Kenya

South Africa

Kuwait

Lebanon

Jordan

Zambia

Zimbabwe

Tunisia

Botswana

Ivory

Coast

Tanzania

Namibia Mauritius

Bahrain

Oman Senegal

Turkey Iraq

Arabian Gulf shows how resources can be harnessed

$100 per barrel oil* gives Gulf Cooperation Council (GCC) more than $200 billion budget surplus

Surpluses fund economic diversification

GCC to award over $160 billion of projects in 2011, including for infrastructure and energy

Extra $136 billion spending in Saudi Arabia

Qatar project spending forecast to reach $100 billion over five years

GCC continues to accumulate surpluses

2012 budget oil price assumption

Saudi Arabia 85.0

UAE 79.5

Qatar 59.0

Kuwait 65.0

Oman 79.0

Bahrain 89.0

Source: Invest AD Research; Bloomberg data; MEED 31st December 2011. Average realised price per barrel

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9

10% of world’s oil reserves

40% of gold reserves

80-90% of chromium and platinum group metals

Broad even spread of the mineral reserves across the entire continent

60% share of the world’s arable land yet to be cultivated

Natural resources give Africa huge potential

Sources: The Economist: February 11th, 2012. Invest AD research

Sources: The Economist: February 11th, 2012. Invest AD research

Markets

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GCC: Valuations attractive, high forecast earnings growth

Source: As at Q 4 2011 - HSBC 11

Oman

Kuwait

Qatar

Saudi Arabia

Dubai

Abu Dhabi

Mexico

Taiwan

Philippines Malaysia

Korea

Indonesia

India

China

Egypt

Poland

Czech Republic

Turkey

Russia

South Africa

-5%

0%

5%

10%

15%

20%

25%

30%

4 6 8 10 12 14 16

PE (2012e)

EP

S g

row

th (

2013e)

S&P GCC index

Market Market Cap (US$ mln)

Daily turnover (US$ mln)

Listed firms

S&P rating*

Saudi Arabia 325,000 1,100 148 AA-

UAE 104,000 31 94 AA**

Qatar 121,000 66 44 AA

Kuwait 97,000 81 221 AA

Oman 17,000 7 116 A

Bahrain 15,000 1 41 BBB

* Long-term foreign currency debt rating ** S&P rating for Emirate of Abu Dhabi Source: Bloomberg, - Invest AD

Financials 48%

Materials 25%

Telecoms 11% Industrials

9%

Consumer Staples

3%

Utilities 2%

Energy 2%

Consumer Discretionary

0%

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Africa: Valuations attractive, high forecast earnings growth

Egypt

Morocco

EASTERN EUROPE

ASIA

LATAM Nigeria

Kenya

Tunisia

Ghana

Mauritius

4

6

8

10

12

14

16

18

20

4 6 8 10 12 14 16 18

EP

S G

RO

WT

H 2

01

2

PE 2012

13

MSCI Emerging Africa (ex South Africa)

Market Market cap (US$ mln)

Daily turnover

(US$ mln)

Listed firms

S&P rating*

Egypt 62,500 100 226 BB

Morocco 65,600 59 77 BBB-

Nigeria 44,000 34 239 B+

Kenya 9,800 5 54 B+

Tunisia 9,800 4.5 59 BBB-

Mauritius 8,200 1.3 40 N/A

BRVM market 7,200 0.5 33 N/A

Zambia 2,000 0.8 19 BB+

Botswana 4,400 1.0 20 A-

Ghana 3,200 0.2 36 B

• Long-term foreign currency debt rating;

Source: Bloomberg, - Invest AD 14

Financials, 44.75%

Consumer Staples, 20.50%

Telecoms, 20.00%

Industrials, 11.28%

Materials, 2.64%

Consumer Discretionary,

0.82%

Focus on Africa

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Assessing Africa

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54 countries & 36 stock exchanges, Over 1bn people and 41% under the age of 15

52 cities of at least 1m people

Mobile phone penetration of about 50%

Over 300m people now classified as “middle class” (up 27% from 2000)

60% share of the world’s arable land yet to be cultivated

GDP of Sub-Sahara Africa increased 64% between 2005 and 2010 to reach $1,018 billion

Demographics Africa’s population forecast to grow 50 percent

to 1.5 billion by 2050

Domestic Consumption African consumer spending set to climb 60%

to $1.4 trillion by 2020

Consumer spending is more than India or Russia

Urbanisation Half of Africans to live in cities by 2030,

up from 37% currently

Sources: IMF and World Bank June 2011.

High-growth economies

Among world’s fastest growing economies

Iraq: 10.8%

Ethiopia: 8.1%

Ghana: 7.0%

Nigeria: 6.8% Tanzania: 7.3%

Mozambique: 7.8%

Qatar: 8.4%

Saudi Arabia: 4.5%

South Africa: 4.1%

Kenya: 6.3%

Zambia: 6.9%

Botswana: 6.0

Forecast 2011-2014: Annual real GDP growth (CAGR)

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Many long-running wars have ended

Foreign debts and government deficits are down

Companies are investing and expanding

Spread of Multi-party democracy

Incomes are growing

The good decade past

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May 2000

December 2011

Between 2001-10, six of the ten fastest growing economies in the world were in Africa

Between 2004-08, real GDP growth across sub-Saharan Africa was 6.6%, more than twice the pace of the 1980s and 1990s

Average real GDP growth is forecast to be 4.9% between 2012-16, compared to expected world growth of 2.9% in the same period

Ghana was projected to be the world’s fastest growing economy in 2011, at 16.3% (Standard Bank)

Growth and investment has been strong

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Average inflation rates have fallen from 22% in the 1990s to 8% during the 2000s

Both corporate taxes and trade barriers have been cut, and institutional bodies strengthened in many places

Average government debt overall has fallen 28%. Various debt relief programmes have written off debt in exchange for reforms

A privatisation trend that started in the 1990s has continued and accelerated

The market has changed

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Less correlated with other global markets

Correlations over last three years (monthly total returns in US$)

DJ Eurostoxx 50

FTSE 100 0.94

S&P 500 0.90

MSCI Asia 0.88

MSCI Emerging Markets 0.86

S&P GCC 0.69

MSCI EFM Africa Ex South Africa 0.54

Indices used: S&P GCC Composite LMC, S&P 500, MSCI AC Asia, MSCI EFM Africa ex ZA, MSCI Emerging Markets, EuroStoxx 50 (all net total return in USD). Data series from 31st Dec 2008 to 31st Dec 2011 based on monthly % - Invest AD.

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EIU Survey

Into Africa: Institutional Investor intentions to 2016

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Investors are taking an interest – EIU Survey

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1. More focused targeting on specific opportunities in specific countries/regions

2. Generally longer-term perspective: nearly two-thirds (64%) of those polled agree that due to the volatility of returns in Africa’s frontier markets, such investments must be considered long-term

3. As a frontier market, Africa is highly rated by investors for the opportunity it holds

A new wave of interest

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Africa remains the world’s least developed continent

A good decade past, doesn’t guarantee a good decade ahead

The Arab Spring has resulted in some government changes, but a stable new order has yet to take hold

Political risk remains a concern, but less so than illiquidity in markets, or weak legal and governmental institutions

Enduring barriers & risk

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Most African countries remain in the lower rankings of Transparency International’s (TI) Corruption Perceptions Index

Of 15 African countries tracked in 2001, eight had improved their scores by 2010, with one remaining at the same level, but six had declined over the period

Corruption is similarly rife in other emerging markets, including all the BRIC countries

Concerns about corruption are twice as high among investors with no current exposure to African markets compared to investors with current exposure (64% compared to 33%)

The leading challenge overall: Bribery and corruption

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Previously investors tended to view Africa purely as a commodities opportunity (often via international mining stocks)

Today investors also look to gain from the emergence of a strong middle class, similar to the story of China and India

Rising consumerism is now rated the most attractive aspect overall of investing in African frontier markets

The new investment case for Africa

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Although consumerism is most attractive to investors, they still expect the highest returns from energy and natural resources

Returns are also expected to be high in agriculture, construction, financial services and telecommunications

The expanding consumer class is steadily helping to counteract concerns about an overreliance on resources

Where to invest

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1. Institutional investors see African frontier markets holding the greatest overall investment potential among similar markets globally

2. Institutional investors plan to increase their asset allocation in African markets over the coming five years

3. Investors are moving to longer-term investment strategies for Africa, rather than more speculative, short-term bets

4. Africa’s emerging middle class is catching investors’ eyes, ahead of commodities and natural resources

5. Investors now worry more about technical concerns than about macroeconomic and political risks, at least in key markets

Key Findings of EIU Survey

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Oil & gas

Minerals & commodities

Agriculture & agro-processing

Tourism

Textiles

Second largest continent in land mass; one billion population

Rising population, though growth rate slowing

“Reverse brain drain“ as African executives returning from developed markets

Domestic consumption of emerging middle classes

Diverse growth drivers

Road/rail

Power

Water

Education & health

Oil & gas-related

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Demographics Natural resources Infrastructure

development

Thank You

Invest AD Invest AD Asset Management PJSC PO Box 46309 Abu Dhabi, United Arab Emirates

David P. Sanders, CFA d.sanders@investad.com +971-2-692-6325