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Sunday, October 5, 2014

Stamp Investment Tip: Zululand 1892 5sh Rose (Scott #11)

   Zululand, a British colony, issued 24 stamps between 1888-1896, and all are worthy of consideration as investments. In 1897, Zululand was annexed to  Natal, which in turn was integrated into the Union of South Africa in 1910.

   In 1892, the Colony issued a 5 shilling stamp (Scott #11) by overprinting 998 of Great Britain's 1884 5 shilling Victoria stamp (Scott #108).   Obtaining expertization for Zululand #11 unused is not necessary because GB #108 is actually more expensive, despite being far more common. Scott '14 prices Zululand #11 at $700.-  for unused.

  The main sources of demand for stamps of Zululand 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.

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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