Africa is one of the few places where the past continues to haunt the minds of potential investors. The phrase “this is Africa,” made famous by the movie Blood Diamond, seems to pervade the imaginations of many. Yet, looking at the facts, there is significant growth opportunity for exchange traded funds (ETFs) that many investors fail to see out of fear.

According to Vito J. Racanelli of Barron’s, the image of Africa as lawless, corrupt, unstable, inadequate and uneducated is wrong and could cost many potential investors a big opportunity. [South Africa: World Cup Afterglow?]

Instead, Africa has “transformed itself into one of the fastest-growing regions in the world, where banks haven’t needed bailing out, no large companies have folded, with no accounting scandals and where the biggest problem businessmen have is getting capital to finance growth,” says Miles Morland, whom many consider to be the father of fund investment in Africa.

The opportunity now is particularly excellent because many stocks are now selling at 11 to 12 times trailing 12-month earnings; in the States, stocks historically trade at 15 times trailing earnings.

China has definitely seen the opportunity. In return for commodities, China is building out Africa’s infrastructure in seaports, power plants and roads, which effectively makes China a big investor in Africa. [The Vast Appeal of Frontier Market ETFs.]