I subscribe to the “Stock Gumshoe” blog, which specializes in ferreting out the truth behind those teaser ads for scores of investment newsletters and tipsheets that promise you 1,400% returns in six months, but only if you take advantage of this limited time subscription offer, a $1,000 value for only $695. In addition to debunking these extravagant claims, the blog’s publisher and author, Travis Johnson, analyzes various investment opportunities he finds interesting, some of them off the beaten track, and he doesn’t charge you hundreds of dollars to reveal the names and details. Recently he posted a lengthy article on Africa, with a particular focus on Lonrho, a U.K.-based company with a long history in Africa and a newly revitalized Afro-centric investment strategy. Here is my comment, posted on Travis’s blog:

I am a big fan of Africa, probably a function of my having worked and/or lived there for about a third of my adult life, and I thank you, Travis, for focusing on a much-maligned and -neglected part of the world. As a business consultant and sometime private equity/finance adviser and investment banker, I lived in South Africa for seven years, most of the time working in the financial sector. I have also lived for extended periods in DRC, Botswana, and Zambia, and I have worked or done business in about 30 countries on the continent.

I believe that African risk, more than almost any other region’s, is overpriced. Part of this is because most people, especially in the U.S., think Africa is one country, and can’t distinguish between Sudan and Senegal. Of course there are risks, but most of them can be managed, and there is certainly a risk premium for investing there, but I have come across far too many supposedly sophisticated investors who won’t touch any part of Africa with a barge pole.

There are a lot of ways to get African exposure, but apart from investing in various Africa-focused ETFs or buying the shares of African companies with ADR listings, there aren’t too many pure Africa plays. You could invest in big mining companies like BHP, RTZ, or Freeport McMoran, junior mining companies, mainly listed on the TSX, or in various energy companies both big and small that operate around the continent. But except for a few juniors, most of these companies have exposure all across the globe. The same goes for companies like Diageo (which owns Guinness), Heineken, and SAB Miller, which dominate brewing across Africa, and for telecoms firms like MTN, which have extended (some would say overextended) into Asia and the Middle East. The big companies listed in Johannesburg, many of which have primary or secondary listings in New York or London, are not pure African plays either. SASOL, Sappi, Old Mutual, Anglo American, and others, have their roots in South Africa, but operate all over the world.

Lonrho (LONR in London, LNAFF on the pink sheets) is an exciting company, resurrected from the ashes of Tiny Rowland’s old company, which operates in some of the most promising growth areas on the continent. They do mine for diamonds in South Africa (not too exciting), but the real excitement is in some of the areas Travis mentions: the Luba Freeport in Equatorial Guinea, the new Fly540 airline operating out of Kenya, and big agribusiness plans across Southern Africa. As the world, and especially the Gulf countries, look to secure their food supplies, they are turning to Africa, which presents huge opportunities for investment in the sector. Lonrho also offers one of the few Zimbabwe plays around, and if you think this is a bad joke, don’t. Zimbabwe is starting to come back, and sooner than you think it will once again be a huge agricultural exporter, manufacturing center, and tourism destination. I think Lonrho is a classic buy and hold opportunity. Buy it now, forget about it, and in several years you could be holding something pretty valuable.

Lonrho, and Southern Africa, are not the only play on the continent. I have said before (you can look it up on my blog - http://www.emergingmarketsoutlook.com) that in the next 20-40 years Nigeria will be a more important economic (and possibly political) force than Russia, and I still believe that. Nigeria has a long way to go, but it looks like following a similar path to Indonesia’s, which has gone from military dictatorship to genuine democracy and which has made a significant dent in corruption.

By all means do your own research. If you are looking to start living off your retirement funds in the next five years, Lonrho and other Africa plays may not be for you. But if you are looking at the longer term, take a close look at these.

Disclosure: T. Rowe Price Africa and Middle East Fund (NYSE: TRAMX). Market Vectors Africa ETF (NYSE: AFK).