Africa is a fast-growing emerging market. Better still, the recessionary effects that gripped the continent may have been more mild than previously believed. ETFs aimed at the continent could be in a prime position to prosper.

The International Monetary Fund (IMF) now projects Africa’s economy will expand 4.3% this year, up from the previously forecast 4%. Next year could be even better – it’s expected to grow 5.3% then, reports Mike Cohen for Bloomberg. The IMF also expects sub-Saharan Africa’s economy will expand 4.3% this year and 5.5% the next.

Much has been made of the BRIC countries (Brazil, Russia, India, and China) and their return to center stage in 2010. There is no argument here that their growth potential is promising, and equally as important, that their political clout is rising. It is hard to say whether they really deserve the tag of "Emerging Markets" any longer. The graph below illustrates the enormous outperformance of the "BRICs" relative to Emerging Markets and the World Index.

The Africa Index ETF that Market Vectors sponsors (AFK), has been a shining example of how diversifying assets outside of domestic US markets can be quite profitable. Unfortunately, Africa is usually at that center of negative press generated by biased western media. But, sticking to true capitalist form, you cannot refute the percentage gains this ETF has produced in the 2009 year. AFK produced 35% in 2009 vs. a mere 26% for SPY.