For many investors, emerging markets represent the next wave of global growth stories. With their growing populations, rising incomes and resource demands, these developing countries will be major contributors to global GDP strength going forward. To that end, many portfolios now consider funds like the iShares MSCI Emerging Markets Index (ARCA:EEM) as necessary core holdings.
However, most of these funds focus on traditional emerging markets or the BRIC economies. That means much of their growth stories have already been televised. For investors seeking uncorrelated returns and perhaps one of the last untapped markets left, Sub-Saharan Africa represents one of the last great portfolio frontiers.
SEE: Most Promising Emerging Markets For 2013

Outsized Growth Potential 
Historically, Africa has been seen as a wild frontier. However, today, the continent is burgeoning with investment potential. Once fraught with political and social instability, Sub-Saharan Africa has seen strong economic growth and a more stable political environment in recent years. War, famine and authoritarian regimes are becoming a little less common, while vibrant democracies are quickly becoming commonplace across the continent.
As such, the region has seen tremendous growth over the last few years. Real income per person has grown by 30% over the past decade, while the overall continent featured GDP growth of 4.12%, according to the World Bank in 2012.
Much of this growth has been on the back of natural resources wealth. Africa is also home to one of the planet's largest concentrations of natural resources. Nearly 40% of earth's total gold reserves and 30% of its mineral deposits lie within Africa's borders. Not to mention, the regions vast oil and natural gas assets. This mineral wealth has slowly transformed Sub-Saharan Africa into a rich consumer market.
Already, the middle class numbers roughly 300 million people. Yet, 40% of the continents population is younger than 17. That provides plenty of growth as these younger citizens move up in spending power. Analysts estimate that consumer expenditures in Sub-Saharan Africa will soar by 65% to nearly $1 trillion by the end of this decade. While average GDP is set grow around 6% annually over the next 10 years. Some nations- like Kenya and Nigeria- are set to grow by even more.

SEE: An Evaluation Of Emerging Markets
Adding the Next Big Growth Story 
For investors, adding Africa to portfolio can be viewed like adding Brazil or China back in the early 2000s. While there is still much risk, the potential rewards are great. Only a handful of South African based companies- such as gold miner AngloGold Ashanti (NYSE:AU) or energy firm Sasol (NYSE:SSL) -trade on American exchanges. This is one instance where funds can make a real difference for investors.
The most heavily traded fund focuses solely on Sub-Saharan Africa’s largest market- South Africa. The iShares MSCI South Africa Index (ARCA:EZA) spreads its approximate $500 million among 51 different South Africa companies. As is the case with most emerging market indexes financial stocks make up the bulk of the fund, followed by consumer nations. Expenses run a surprisingly cheap 0.60%. Not surprising was the fund’s annual returns since its inception in 2003. EZA has managed to rack up a 15.65% annualized total return in that time.
If South Africa represents the old guard, then Nigeria could be the new. The nation’s vast oil wealth has managed to produce stellar GDP growth. In the last quarter of 2012, Nigeria's economy grew about 7%, while its stock market advanced 56% throughout the entire year. Honing in on that opportunity is the new Global X Nigeria Index ETF (ARCA:NGE). The fund tracks 28 Nigerian firms as well as a few firms like oil service provider Subsea 7 SA (OTC:SUBCY) that derive a substantial amount of their revenue from the nation. While it’s risky, the new fund could prove to be a winner over the longer haul.
Finally, for investors looking for broader plays on the continent and Sub-Saharan African growth, both the Market Vectors Africa Index ETF (ARCA:AFK) or SPDR S&P Emerging Middle East & Africa (ARCA:GAF) can be used as proxies for the region.
SEE: Emerging Market ETFs For Your Retirement Accounts

The Bottom Line 
Emerging markets represent the world's future economic growth engines. However, the majority of investor attention is tilted towards the BRICs and broad index funds within the sector. Looking past them, Africa represents a huge ignored growth story. The preceding ETF picks are prime examples on how to gain access to the nation’s rapid growth.

At the time of writing, Aaron Levitt did not own shares of any of the companies or funds mentioned in this article.

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