Another tumultuous month has passed, with even the hitherto-acknowledged 'safe havens' such as gold declining in value by 11.23% (Source: Bloomberg). Scipion's equity classes largely aped the month's global downwards trend in quoted equities (e.g. MSCI Emerging EMEA down -17.33%). The better relative performance of our Class S Alpha Seeker (down -7.6%) over our Class I Index Tracker (down -10.25%), was prompted by its lack of exposure to the more globally-correlated South African market, which, in addition to representing the largest single geographical component of Class I by value, additionally saw the Rand weaken from 6.99 to 8.09 against the greenback over the month.

Meanwhile, our Class A Commodity Trade Finance fund maintained its strong performance, with +0.58% growth since the end of August extending our perfect record to 49 consecutive months of positive returns since inception. Part of this absolute return emanated from our financing the last few crops of the West African coffee season, but also from our first pre-export trade financing of chrome ore to China.

In recent years, Asia's relationship with Africa has often been controversial, as events this month, with the Dalai Lama's South African visa failing to materialise, and the election of the historically Sino-sceptic Michael Sata to the Zambian presidency, have also alluded to.

We believe it is a mistake to ignore the historical context of the economic times we live in. Accordingly, as the rollercoaster sovereign debt ride continues, the irony is not lost on us that those countries traditionally held as the originators of European civilisation - Italy and Greece - now lie at the heart of the EU's existential troubles; our namesake Scipio is no doubt turning in his grave....

While to some extent European history and achievement is being tarnished by present political impotence, China and India are conversely becoming more assertive at reclaiming their former global importance, and in perhaps few more visible contexts than the African continent, itself in the process of reclaiming past productivity.

For instance, in the 70s and 80s, Liberia was one of the world's major iron ore producers. Through civil conflict and negligence, the mining industry slowly fell into disrepair, but remained an interesting opportunity. Indeed, to this end our investment team conducted in-country due diligence in early 2010. We were not alone. After investing some $800m, Arcelor Mittal this month shipped the first Liberian iron ore out of the port of Buchanan for twenty years. Change is thus clearly apace. Elsewhere, the past month has seen Chinese companies look to acquire increased stakes in resources ranging from Namibian uranium to Guinean iron ore.

Africa possesses many of the resources upon which Asia depends - for instance holding some 90% of the world's chrome, a commodity vital in stainless steel manufacture - so it is natural for Scipion to facilitate this burgeoning inter-continental trade, which perhaps first truly began with the expeditions of Admiral Zheng He in the 15th century.

Negative images of the relationship will undoubtedly persist - although, as has already been seen in Zambia, Michael Sata's opposition-era Sino-scepticism has been largely co-opted by realpolitik - but the fact remains that Asia is a vital part of the African (and global) economy: its fall, not its rise, is the greater threat to wider prosperity.   

Nicolas Clavel