African securities exchanges discuss plans for unique index
This could boost new listings on African markets.The directors of Africa's securities exchanges have discussed the implementation of a unique index at a conference organised this week by the African Securities Exchanges Association (ASEA) in Johannesburg, South Africa.
"Integrated stock markets improve resource allocation and accelerate growth by facilitating liquidity," said ASEA president Oscar Onyema, quoted by This Day.
He added: "We must begin to study how to effectively link the entire region. The African Exchanges Linkage Project which is a jointly owned mandate between ASEA and the Africa Development Bank, is a step in the right direction. It is aimed at addressing the lack of liquidity in African capital markets by creating linkages across key regional markets to reduce fragmentation and information asymmetry."
According to him, such project could boost new listings on African markets, given that there are 1.5 million successful businesses operating in the continent, but only 1,600 companies are listed on the exchanges of the 23 nations that make up the association.
" I propose we find new ways to engage with business leaders in order to communicate more clearly the vital role we play in facilitating long-term financing and mobilising resources," he concluded.
During the exchange conference participants also discussed the role of pension funds on financial markets and how they can be used in a sustainable way.