Africa’s capital markets have set themselves a tough programme of action, following the executive committee and annual general meetings of the African Stock Exchanges Association (www.africansea.org) held last week (10 Nov). According to an ASEA press release they are driven growing interest in African securities markets from local and international investors and decided: “..to harness the current and future growth potential of African markets and raise the visibility of African exchanges at the international level.
Plans include an improved website, development of a broad-based pan-African index which could also lead to a pan-African Exchange Traded Fund to be cross-listed on several exchanges. The continent’s securities markets are also to lobby on improving the business and investment environment in African countries as this could help Africa get a bigger share of business. They will also work closely with the African Development Bank and consider boosting the ASEA secretariat through permanent staff at their Nairobi base.
ASEA President Sunil Benimadhu, who is also the CEO of the Stock Exchange of Mauritius, chaired the meeting which was held in Livingstone, Zambia, ahead of the ASEA conference.
According to the resolution:
“ASEA Website: It is fundamental that ASEA’s website grows into a dynamic and integrated source of comprehensive and updated information on African securities markets for the wider investment community. ASEA has approved a proposal to engage a financial data services provider to revamp ASEA’s website into a highly informative website that provides extensive coverage of the daily activities of African securities exchanges.
“Development of broad based Pan African Indices: ASEA has resolved to finalize discussions with a major international index provider to develop and market a broad based Pan African Index. It is expected that this Pan African index will emerge as a reference benchmark for performance measurement for investors investing in the African markets constitutive of the index. The Pan African index may also help to create the necessary framework for the setting up of an African Exchange Traded Fund that can be cross listed across different African securities exchanges.
“Improving the environment for doing business in Eastern and Southern Africa: The Association mandated the ASEA President to engage with the World Bank and the Regional Multidisciplinary Center for Excellence (RMCE) in a regional initiative to improve the environment for doing business in Eastern and Southern Africa. This initiative aims at supporting countries to design and implement policies that will improve the business environment in Eastern and Southern Africa and ultimately increase this region’s world share of investment and exports. Securities exchanges in this region are expected to contribute to and benefit from this regional initiative.
“Establishing closer ties with the African Development Bank: The Association gave the ASEA President the mandate to pursue discussions with the African Development Bank’s “Making finance work for Africa” initiative, and the African Development Bank’s Private Sector arm in identifying areas of cooperation that can contribute to the deepening and broadening of African securities and capital markets and enable these markets to accompany the transformation of African economies, while ensuring that African securities markets emerge as key capital raising platforms to fund Africa’s future growth.
“Leon H. Sullivan Foundation: The Association resolved to issue a non binding letter of support to the Leon H. Sullivan Foundation in support of their Disapora Programme, which seeks to promote investment into African capital markets by African Americans.
“ASEA Secretariat: The realization of these initiatives underscores the importance of a Permanent ASEA Secretariat. The Nairobi Stock Exchange which currently manages the Secretariat on a voluntary basis has been requested to explore the modalities of setting up a dedicated Permanent Secretariat by the end of the first quarter of 2011. The Permanent Secretariat will be tasked with the implementation of a number of key initiatives to raise ASEA’s profile and the visibility of the member exchanges and to scale up ASEA’s activities to better service the different stakeholders of ASEA members.”