9. ODA and your business – Despite renewed interest in borrowing on the international debt markets, governments in sub-Saharan Africa remain dependent on donor funding. Gross official development assistance (ODA) to Africa is roughly US$32 billion per annum, so knowing where, why and what donor money is being allocated can affect investments. Distinguishing signal from noise out of policy circles in Washington, Brussels, Beijing, Geneva, and Addis Ababa, can help reduce risk and help insure an asset. A good recent example of how much this can affect your portfolio is what happened in Rwanda. Responding to a controversial UN report implicating Rwanda in violence in the DRC, donors cancelled funding to Rwanda, which then prompted a downgrading of the country’s sovereign bonds by ratings agencies.

10. Labour myths – Two persistent myths about Africa’s labour force dog investment decisions: that skilled labour is hard to find and that all labour is expensive. In a recent poll by McKinsey on Africa’s labour force, finding skilled labour wasn’t mentioned as a major impediment to firms and the actual average wage costs on the continent are a third of what they are in Asia (in Ethiopia it’s one-sixth).

11. Beware the “Grey Swan” – Investors often focus on risk factors and large-scale negative events, such as conflict or political instability. However, more subtle issue such as a drift in import regulations or taxation structures, can strongly impact the value of investments. When developing a market entry strategy, companies should include scenario planning that budgets for extensive stakeholder engagement and government relations.

12. The guy behind the guy – Companies often focus on engagement at the ministerial level, but knowing whose responsibility it is to actually carry out a given policy is at least as important as knowing the formal decision-makers.

13. Don’t buy a return ticket – Simply having eyes and ears on the ground often doesn’t cut it. Deals fall apart because different parties to a transaction know who is flying in and out and who is staying for the long haul. Impermanence of one party undermines all deals by diluting trust and commitment among the parties.

14. Know your stakeholders – With 36,000 registered NGOs in Africa, knowing who your stakeholders are has never been more important. Companies can be cavalier with their stakeholder strategies and throw money and lavish galas that at best miscommunicate the company’s commitment to the country’s development and at worst attracts the wrong kind of attention.

15. Be “negatively capable” – First coined by John Keats to describe the ability to “flourish in uncertainty,” the theory of negative capability has broad application to doing business in Africa today. Most business innovation in Africa happens because entrepreneurs work constructively in unstructured environments and do not let the inability to measure, quantify or assess their progress perfectly get in the way of moving things forward imperfectly.

16. Find “work for now” solutions – The urge to revert to “best practices” based on World Bank analyses should be avoided. Every situation is different and time and resources should be dedicated to finding best fit solutions to business problems. Often this will entail ‘working with the grain’ of existing institutions and then adapting and correcting as you go along.

17. Avoid risk compensating – Once settled on an investment, companies tend to put too much stock in traditional risk tools, such as political risk insurance or forex hedging. The complacency that buying these tools sometimes leads to can itself increase the risk profile of an investment: companies tend to demonstrate less caution where they feel more protected and more caution where they feel a higher level of risk. Knowing the right balance between protecting against, and being continually aware of risks is critical.