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 holdings like the Schwab Emerging Markets Equity ETF (Nasdaq:SCHE) as necessities. However, most of these funds focus on traditional emerging markets or the BRIC economies, and many of these growth stories are already well known. For investors willing to look off the beaten path, there are other opportunities in Asia, Eastern Europe and the Middle East. Right now, one of the more intriguing areas for investment is in Africa.

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The Last Frontier
Historically, Africa has been seen as a wild frontier; today, the continent is burgeoning with 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. Eleven countries within the continent are now growing by more than 7% annually, with three of those reaching 10% GDP growth. That's more nations than in Southeast Asia. Overall, the region has experienced growth, averaging 6% annually since 2004.

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, and the nation has grown its proven oil reserves by 116% since 1989. Analysts estimate that there is $7.3 trillion worth of oil in East Africa alone. This resource wealth has attracted other emerging markets and exports from Africa continue to increase. Exports to China have increased more than six-fold from 2004 to 2009 and several nations have a variety of favorable trade pacts with the developed world. For example, Ghana's exports qualify for duty-free access in the United States and European Union markets.

This resource wealth is finally beginning to help boost living and political situations in the nation. Resource dollars are flowing back into African infrastructure, telecommunication and consumer spending. Nearly, 34.3% Africa's population has obtained middle class status and is home to more cities with a population of million residents than in all of North America. Analysts at think-tank McKinsey project that total household spending in Africa will reach $1.4 trillion by 2020 and more than half of households will have ability to make "discretionary" purchases. In addition, education is on the rise. Enrollment in secondary school has skyrocketed with current enrolment at 29% versus less than 3% in the 1960s.

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. Overarching funds like the Market Vectors Africa Index ETF (NYSE:AFK) or SPDR S&P Emerging Middle East & Africa (NYSE:GAF) can be used as proxies for the region. However, as Africa continues to rise to prominence, the ways to add the nation continue to grow.

Diversified energy and chemicals company, Sasol (NYSE:SSL) is a double play on basic materials. The company features operations spanning coal mining, petroleum exploration and refining to chemical and polymer manufacturing. Most recently, the company has expanded into gas-to-liquids operations and trades for a forward P/E of less than 9. In addition, both Afren (OTCBB: AFRNF) and Tullow Oil (OTCBB:TUWOY) make interesting plays on Africa's new found oil wealth.

With gold prices continuing to rise in the face of economic uncertainty, Africa's wide variety of gold miners will benefit. AngloGold Ashanti (NYSE:AU) is Africa's biggest gold miner, with both Gold Fields (NYSE:GFI) and Harmony (NYSE:HMY) rounding out the top five. These firms should continued production as well as higher profit margins as the world continues to clamor for gold.

Finally, telecoms within Africa look good. Mobile phones penetration rates on the continent are expanding fast, but still are only around 50% in Africa. Global wireless provider Millicom International Cellular SA (Nasdaq:MICC) operates in African nations like Chad, Ghana and Rwanda, while both VeriFone Systems (NYSE:PAY) and Net 1 (Nasdaq:UEPS) have been making headway into the African m-banking market for the poor.

The Bottom Line
Emerging markets represent the world's future economic growth engines. However, the majority of investor attention is towards the BRIC and broad index funds within the sector. Africa represents a great way to play an ignored growth story and the preceding picks are just a few examples on how to gain access. (For additional reading, also take a look at Re-Evaluating Emerging Markets.)

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