The 20thAfrican Securities Exchanges Association (ASEA) annual conference took place from 27 to 29November at the Kigali Serena Hotel. ASEA is the Premier Association of African Exchanges and was established to provide a forum for mutual communication, co-operation and technical assistance among its members and facilitate a process of financial integration within the regional blocks.
The 20thAfrican Securities Exchanges Association (ASEA) annual conference took place from 27 to 29 November at the Kigali Serena Hotel. ASEA is the Premier Association of African Exchanges and was established to provide a forum for mutual communication, co-operation and technical assistance among its members and facilitate a process of financial integration within the regional blocks.
The conference which took place under the theme: "The Road to 2030: Making the African Capital Markets Relevant to the real economy”brought together over 300 experts and stakeholders from capital market firms, regulators, domestic, regional and international investors. The conference took place at a time when the Rwanda Stock Exchange was celebrating its 5th anniversary.
Favourableenvironment for the growth of stock exchanges are beginning to take root in Africa. Along with political stability, economic experts attribute increased investment flows to Africa to higher commodity prices and improved macroeconomic stability.
Rwanda is now one of Africa’s fastest-growing economies, thanks to its pro-business policies and a positive investment climate.
The small size of African stock markets and the absence of liquidity are often cited by foreign investors as major impediments to investing in the region.
Experts during the conference recommended merging them into regional exchanges as one solution. A regional exchange should mean more liquidity — the lifeblood of exchanges — by making stocks available to a wider range of investors
According to Celestin Rwabukumba, CEO of Rwanda Stoke Exchange and Chairman of the East Africa Securities Exchanges Association (EASEA), through innovation and technology, Africa’s capital market has the potential to harness resources needed to fuel structural transformation that the continent needs.
He however said there is an urgent need to incorporate inclusiveness in the entire African capital market place. The current situation is such that Africa capital markets only allow a very tiny segment of less that 5 percent of the entire population to participate in its trading platforms.
"This is a blessing in disguise as it means that there is a huge opportunity to widen the base of Africa capital markets by incorporating new models based on technology and other creative innovations that target provision of direct linkages with the ordinary citizens in order to bring them to the loop of resource mobilization and utilization” Rwabukumba said.
"Confronting the boogey man of African Capital Markets-Small size, illiquidity and volatilityis key to growing the market, in addition to primary leadership and technology.” Bosco Sebabi, Deputy CEO, In charge of funds management at Rwanda Social Security Board
He said that there are lessons learnt from the conference that will help Rwanda to maintain proper codes and acceptable practices on the capital market. He also added that hosting the event in Rwanda had some good benefits to the economy.
"The rewards of holding conferences in Rwanda are by no means confined to the duration of the event. Following this conference and many other international conferences that Rwanda has been hosting since 2014, we continue to be flooded by international visitors, which gives Rwanda a wonderful exposure around the world” says Sebabi
He also said that there is need to educate the masses on capital markets and also to push the Rwanda capital market to look for additional products that will offer alternative and modern methods of mobilizing long term capital for SMEs.