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Sunday, September 22, 2013

Stamp Investment Tip: Natal 1877 Surcharges (Scott # 59-60, 61-63)

    In 1877, the British issued five surcharged stamps for Natal, including two that were Perf. 14, and a set of three that were Perf. 12 1/2 (Scott #59-60, 61-63). Scott #59 and 60 had a combined printing of 23,760, and #61-63 had a printing of 56,540. Scott '13 values the #59 unused at $37.50, #60 at $100.- , and # 61-63 at $205.-. There are also a number of surcharge varieties, most of which catalog in the hundreds of dollars. They are very scarce to rare, and I recommend purchase of them conditional on obtaining expertization. In my opinion, this issue has been neglected because to many collectors, the stamps are just boring surcharged issues from a dead South African state.

The colony was integrated into the Union of South Africa in 1910, and the main sources of demand for stamps of Natal are British Commonwealth collectors and collectors of South Africa, both of which I view as growing markets. A recent Price Waterhouse report projects that South Africa will be one of the world's fastest growing economies over the next 40 years.

As a a middle-income country of about 49 million, South Africa has an abundant supply of resources, well-developed financial, legal, communications, energy, and transport sectors, a stock exchange that ranks among the top twenty in the world, and a modern infrastructure supporting an efficient distribution of goods to major urban centers throughout the entire region. South Africa is ranked 25th in the world in terms of GDP. Annual GDP growth has averaged about 2.5% over the past 5 years.

However, the country has a two-tiered economy- one rivaling other developed countries and the other with only the most basic infrastructure, similar to a Third World nation. Unemployment is extremely high and income inequality is approximately equal to Brazil. Also, there is an 18% HIV infection rate among South African adults, among the highest in the world.

Given the somewhat mixed picture that South Africa presents, I feel that better stamps from the country and its related issuing entities should be viewed mainly as conservative plays on the growth of British Commonwealth collecting. I am hopeful that over time, most of South Africa's worst problems will be ameliorated or solved, but whether that will require years or decades is an open question.

Note that as with many early British Commonwealth perforated issues, the perf holes are often close to the design. When purchasing these stamps, attempt to select for Fine or better examples in which the perfs clear (or barely touch) the design.

Those interested in learning about investing in stamps should read the Guide to Philatelic Investing ($5), available on Kindle and easily accessible from any computer.

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