The African Development Bank (AfDB) has rallied stock exchanges to reinvent Africa’s financial future, noting that they will be a crucial lever for financing African economies.
Speaking at a convention at the lender’s headquarters in Abidjan, the AfDB President, Mr Sidi Ould Tah, said African bourses were vital to the continent’s destiny.
“As the architects of Africa’s capital markets, you are custodians of financial institutions and catalysts of our continent’s future,” he said at the start of the first session with heads of African securities exchanges, private equity funds and venture capital funds.
The meeting, a first of its kind between the Bank and African stock exchanges, aims to explore their role in long-term financing, with a focus on reforming how Africa’s capital is mobilised.
“The capital markets are the bedrock upon which long-term, sustainable economic growth is built,” Mr Ould Tah said, adding “by mobilizing patient capital, you provide our sovereigns and businesses with diversified funding sources, while offering investors, particularly institutional investors, a broader array of opportunities.”
He said the lender would take a comprehensive approach to capital market development, focusing on three key pillars: supporting capital market regulatory authorities, stock exchanges, and other intermediaries through technical assistance, institutional support projects, and policy-based operations; diversifying savings mobilization and market participants to promote product liquidity and deeper markets for credit enhancement companies, institutional investors, and other financial institutions; and research, training, and policy dialogue to enhance the capacity of Africa’s capital market stakeholders.
On his part, Mr Felix Edoh Kossi Amenounve, CEO of the West African Regional Stock Exchange (BRVM), highlighted the need for fundamental change.
“There are gaps between financing needs and available resources, but we need to think about the reforms needed to achieve the capitalisation of African pension funds. Because these funds were originally created to finance governments,” Mr Amenounve said.
Mr Donald Waweru Wangunyu, Non-Executive Director, Nairobi Stock Exchange, stressed the need for regional coordination in order to achieve “scaling up, policy coordination and implementation of reforms; we have good projects, but the obstacles are still there, ” he said.
Ms Sonia Ben Frej, Chairwoman of the Board, Tunis Stock Exchange, emphasised the problems of regulatory convergence and the need to update obsolete regulations.