The Capital Markets Advisory Council (CMAC) has said that government’s quarterly listing of Treasury bonds and the recent privatization policy that encourages the selling of government parastalals through the stock exchange are essential to the growth and development of Rwanda’s capital market.

Olivier Kamanzi, Deputy Executive Director of CMAC, said in an interview with Business Times that government had raised Rwf20 billion by issuing bonds.

He expressed optimism that by 2011, Rwanda’s nascent stock exchange will have attracted at least two or three domestic companies as well as four foreign companies.

"In June 2009, the equity market was launched with the cross listing of Kenya Commercial Bank (KCB), which has so far traded Rwf15 million for about 90,000 shares. On top of that, Bralirwa will soon float 25 percent of its shares on the stock exchange market,” Kamanzi said.

"The capital market will become more lucrative on November 2, when National Media Group (NMG) will cross list its shares on the Rwanda Over-The-Counter (OTC) market.”

NMG, which is listed on the Nairobi Stock Exchange (NSE), also has its shares cross listed on the Uganda Securities Exchange (USE). The media conglomerate is eyeing all of East African Community’s bourses. 

"As the capital market in Rwanda grows, sometimes global capital flow can overwhelm the capacity of the country to invest productively. But with the high standards of CMAC and local investor discipline, this issue can be dealt with satisfactorily,” Kamanzi told over one hundred participants who were attending CMAC’s workshop on bonds and market valuation yesterday.

The workshop was organized in collaboration with Regent University, U.S.A and Rwanda Business Development Centre and it attracted lawyers, journalists and the business community.

While addressing participants, a senior official from Regent University (names withheld on request) urged Rwanda to foster the market by making good business decisions and focusing on input tools like cash flows, paybacks and risk management.

He also commended the government for its policies, such as ensuring a corrupt-free society, which have enabled the capital market to develop at an impressive rate in spite of being only three years old.

"Investors want to see evidence of strong compliance with standards that ensure investor protection before they can venture into investment. It is very clear that both CMAC and the government have a correct approach towards a well disciplined and corrupt free capital market,” he added.

The Rwanda capital market now referred to as the Rwanda Over the Counter (OTC) market, is a new development in the country which was established by the Capital Market Advisory Council in January 2008.

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