Hey, Here's a Tip: Try Africa.

What surprised me most about Africa's stock exchanges weren't the high returns, but the reason for these amazing rates: prejudice.

No, not the black-white variety; it turns out that even Africa's diaspora shares the aversion to investing in the continent. Experts estimate that only 10 percent of Africans living abroad invest back home. It's that we just can't see Africa as anything more than a basket case. It's easy to envision Africans as child soldiers or victims of famine or poverty. But if you envision a stockbroker, an investor, a financial adviser or a mutual-fund manager, chances are you don't conjure up images of Africans. Yet Africa has all of these.

Kim Jaycox, chief executive of the Africa Fund I at Emerging Capital Partners, one of the first and largest equity funds to invest in Africa, explains that the returns are high because the perception of risk is much higher than the reality. When the perceived and real risk levels even out, returns will go down. In other words, as long as we stick to our belief that Africa is a coast-to-coast disaster zone, even well-managed African companies operating in peaceful nations will have to pay a premium to attract capital.

Certainly there are risks to investing in Africa. The markets are small, with little liquidity, making it difficult to move in and out with any speed. Currency fluctuation is also a major concern, although for the last few years it's the dollar that has been losing ground against most African currencies. The main risk is political instability and corruption. The post-election violence in Kenya last December sent that country's stock market reeling, but it rebounded quickly once a political agreement was signed a few months later.

In recent years, Africa has offered the world's highest rate of return, according to United Nations trade figures, and yet the continent would be far down most people's list of investment destinations, with China and India probably at the top. But while we look to invest in China, the Chinese are looking to Africa, where new roads, ports, bridges -- the infrastructure the continent so desperately needs -- are springing up everywhere, thanks to Chinese investment.

What the Chinese want in Africa is what we all want -- the continent's abundance of natural resources, including oil and nearly every strategic mineral that we need for our daily life. Africa recently overtook the Middle East in exporting oil to the United States. The Democratic Republic of Congo has about 80 percent of the world's reserves of coltan, a mineral essential to powering cellphones and other electronic devices. We in the West talk about how much Africa needs us. The truth is that we need Africa, badly.

Who knows how long Africa's current bull run will last? But one thing is certain: Africa's the last big investment frontier. If you missed China and India, don't miss this one.

capineau@gmail.com

Carol Pineau is a filmmaker and journalist who has reported throughout Africa. Her film, "Africa Investment Horizons," premiered at the New York Stock Exchange in April.