By Asmau Ahmad
The African Securities Exchanges Association (ASEA) and the African Development Bank (AfDB) Group are collaborating to expand the number of linked African exchanges from seven to 15.
The Bank in a statement said the expansion was under the second phase of the African Exchanges Linkage Project (AELP).
According to the statement, both parties on June 28 signed an agreement for a $600,000 grant for the project.
It said the funds would come from the Korea African Economic Cooperation Fund (KOAFEC) Trust Fund, managed by the AfDB.
The AELP is a flagship project of ASEA and the Bank Group to link African capital markets, thereby promoting cross-border securities trading, increasing liquidity and diversifying investment opportunities for investors.
According to the statement, AELP’s second phase will provide investors access to more than 2,000 securities listed on up to 15 capital markets.
It said this would be done through a cross-border securities trading platform tailored to the needs of regulators, central depositories, policymakers, and stockbrokers.
“Participating stock exchanges include the Botswana Stock Exchange, where the grant signing took place; the Ghana Stock Exchange and six other stock exchanges.
“The grant will also support capacity building of institutional investors and capital market operators,” it said.
Thapelo Tsheole, the President of ASEA and Chief Executive Officer (CEO) of the Botswana Stock Exchange, signed on behalf of the association.
Tsheole said: “we express our gratitude to AfDB for their invaluable support and dedication to the development of African Capital Markets.
“With the generous grant funding, we are poised to expand technical connectivity and linkage among African stock exchanges, creating a broader pan-African network.
“Together, we are working toward a fully integrated Africa for the benefit of investors, businesses and governments across the continent.”
The Bank Group’s Vice President for Private Sector, Infrastructure and Industrialisation, Solomon Quaynor, signed on its behalf.
Quaynor said: “the Bank is pleased to extend its partnership with ASEA through the follow-on support for Phase 2 of the AELP.
“The AELP is facilitating regional integration through African stock exchanges linkage amounting to up to 1.3 trillion dollars in combined market capitalisation.
“The collaboration between the Bank and ASEA through the AELP aligns with our objective of leveraging institutional investor groups and capital markets financing into infrastructure and the real sector in regional member countries.”
According to Quaynor, the objectives of the AELP align with the African Union’s Agenda 2063 and the African Continental Free Trade Agreement’s goal.
He said the goal was to establish a liberalised market to ease the movement of capital and investments and deepen the continent’s economic integration.
He said the project also advances the Bank Group’s High 5 strategic priority to integrate Africa.
The AfDB supported the first phase of the AELP, which was also funded with a KOAFEC grant.
Phase one supported the setup of an infrastructure interconnectivity platform involving seven stock exchanges and 31 stockbrokers.
It also offered training for more than 1,000 capital market operators.
