When the East African Community (EAC) was revived in 2000, most people were hopeful it would play a big role in the development of the region. 

The ‘old’ EAC collapsed due to misunderstandings between leaders in the 70s.

With pro-integration leaders at the helm of member states, laws that promote one East Africa and business growth, including having all regional bourses marketed as a single market, have been enacted. Although the Rwanda Stock Exchange has only been in existence for the past couple of years, sector players say marketing EAC as a single market will greatly benefit the local bourse.

They laud technocrats and regional leaders for advocating for uniform laws and practices to govern EAC stock markets. The local stock exchange is, in particular, tipped to benefit greatly from this move as it will ease business and attract investors to the bourse.

"We are currently in the process of harmonising our laws and practices with the rest of the stock exchanges in the region. Once this is completed, investors will be able to participate in all the markets through the seamless platform that will be created to access all the stocks across the region,” explained Robert Mathu, the executive director of the Rwanda’s Capital Markets Authority.

"By harmonising the laws and trading platforms investors in Rwanda will be able to access stocks of the 86 companies in any of the different markets, thus creating more diversity for investors,” he added.

Mathu pointed out that when they start trading as a regional bloc through the capital markets, this will provide more avenues for companies and EAC governments to raise affordable capital easily. "The industry will grow faster, thanks to technology that will increase access and attract more investors,” he said.

The Nairobi Securities Exchange, which celebrated 60 years this year, has up to 56 companies listed while the Uganda Securities Exchange has 12. The Dar es Salaam Stock Exchange has 13 companies, there are five firms listed on the Rwanda Stock Exchange and Burundi is yet to establish a securities market.

So far, the central depository systems of the regional stock markets are interlinked. The exercise that was completed last year facilitates electronic conversion of physical paper certificates of shares or other debt and derivatives representing ownership of securities in less than two hours. 

Umeme Limited, whose shares were primarily listed in Uganda in December 2012 debuted on the regional inter-depository transfer mechanism by trading on the Nairobi Securities Exchange in August last year, while Uchumi Supermarkets also took advantage of the system to facilitate its cross-listing in Rwanda and Uganda.

"Investors can now enjoy proficient movement of securities across the region and substantially reduce the exchange rate risk and price movement arbitrage,” said Celestin Rwabukumba, chief executive officer of the Rwanda Stock Exchange.

Edwina Mulanga, the manager of custodian services at KCB Bank Rwanda, a subsidiary of Kenya Commercial Bank that is cross-listed on the Rwanda Stock Exchange said before the link, a Rwandan who wanted to buy the bank’s shares had to first go to its head office in Nairobi to create an account before trading.

"Such an individual would at times come back when the share price has changed and he or she no longer wanted to trade,” she explained.

KCB group cross-listed on the local bourse in 2009, and was joined the following year by Kenyan media giant Nation Media Group.

Uchumi became the third Kenyan company to cross-list on the Rwandan exchange in October last year.

Rwabukumba said after harmonising the laws, the trading platforms would be linked to make it easy for investors to track changes in equity and debt prices from their mobile phone and computers, irrespective of where one will be at a any given time.

If successfully concluded this year, Rwabukumba said it will encourage foreign companies to list shares in Rwanda, opening up opportunities for local equities investors to buy into foreign firms.

The Rwanda Stock Exchange closed last year as the best performing bourse in East Africa, with its all-share index having risen by over 130 per cent from 100 points at the start last year to close at 234 points, driven by a strong price rally from Bralirwa and Bank of Kigali which rose to Rwf845 and Rwf239 respectively, year on year.