8th BUILDING AFRICAN FINANCIAL MARKETS SEMINAR - BAFM 2019
The Building African Financial Market Seminar (BAFM) is an initiative of the African Securities Exchange Association (ASEA), in collaboration with African Securities Exchange, to promote the growth of African financial markets.
"HUMAN CAPITAL: A STONE OF ANGLE FOR THE COMPETITIVENESS OF AFRICAN CAPITAL MARKETS" was the main theme of this 8th edition hosted by the Regional Stock Exchange (BRVM) on 25th and 26th April 2019 at the Sofitel Abidjan Hotel Ivoire. The BRVM, headed by Dr. Edoh Kossi AMENOUNVE, CEO BRVM - DC / BR, has successfully brought together different actors of the African capital markets and enabled them to share concrete solutions for the development of African markets, for which expectations are very important for the market financing and sustainability of the continent's growth.
The Official Opening Remarks addressed by His Excellency Daniel Kablan DUNCAN, Vice-President of Côte d'Ivoire, was followed by a series of interactive training sessions on various topical issues related to the challenges of African capital markets.
The 1st session addressing Strategies and Priorities for Building Capacity for Market Development was introduced by Dr. Roger ATINDEHOU, Director Department of Operations - The African Capacity Building Foundation and presented by Mrs. Candice DOTT, Market Development Director Middle East and Africa - REFINITIV.
Mrs. Kadidiatou FADIKA-COULIBALY, Managing Partner, Hudson & Cie led the 2nd session: "Enhancing Retail Investor Education in African Capital Market". Then, Mr. Stefan NALLETAMBY, Director, Financial Sector Development Department - AfDB gave a special presentation on the theme: "Stimulating African Bond Markets", followed by the 3rd Session on Debt Financing for SMEs, presented by Mrs. Akane ZOUKPO SANANKOUA, Principal Investment Officer - AfDB.
Finally, Mr. Christopher STURGESS, Chief Executive Officer - Burnt Orange Trading, Pty Ltd. closed this first day with the 4th session by giving an Overview of Commodities Exchanges in Africa.
During these sessions, it was emphasized that the availability of information played a capital role in facilitating access to international and regional investors and enabling them to make more informed decisions; improving certain elements, including education and financial inclusion, would improve the quality of the information available.
Later, discussing about the African Retail investor, we realized that improving financial literacy of individual investors could bring several benefits including better disclosure of financial information and better standards of governance. It is within this context that initiatives have been taken by the BRVM to improve inclusion and financial education. The BRVM also offers introductory courses on capital markets and stock market investments.
Regarding the African capital markets, the lack of information has been shown to be one of the main obstacles. To address this gap, the AfDB has launched several initiatives, including the African Financial Markets Initiative (IMFA), to develop local currency bond markets on the continent. Moreover, in order to stimulate the financial markets, the capacity building must be done by following an approach involving synergistic actions by governments, market participants and development finance institutions.
Similarly, the platform One for Africa (One4A) was presented. This platform was designed by the AfDB for small and medium-sized enterprises (SMEs) to help them find sources of finance in the financial markets. SMEs represent 90% of the number of companies in Africa and contribute to almost 45% of job creation. However, access to financing sources remains a major obstacle to their expansion and the financing gap is estimated at more than 331 Billion. There is therefore an opportunity for the financial markets to play a complementary role at this level. The One4A platform aims to close this gap by enabling growing SMEs to finance themselves in the capital markets.
The fourth session highlighted the various initiatives for the establishment of commodity markets on the African continent. To establish a commodities market is not always a viable solution. Thus, a good strategy must be developed and several conditions must be fulfilled beforehand. African countries wishing to develop strong commodity markets need to, among other things, have consistent marketing policies, create liquid markets for local products and ensure a good synergy of actions between regulators, central banks and other market players.
On the second day of the BAFM Seminar, the sessions begun with a Keynote speech by the Public Treasury of Côte d’Ivoire. Mr. Antoine YOBOUE, Special Advisor representing Mr. Konan Jacques ASSAHORE, Managing Director, Public Treasury of Côte d'Ivoire explained the role of the sovereign debt in structuring of capital markets.
Afterwards, Mr. Ekow AFEDZIE, Deputy Chief Executive Officer, Ghana Stock Exchange gave an overview on West African Capital Markets Integration Council (WACMIC). He later presented the 3 phases of the WACMIC model which are: Phase 1 – Sponsored access trading; Phase 2 – Common passport for qualified West African brokers in the ECOWAS; Phase 3 – Fully integrated West African capital market. The WACMIC model aims to establish a harmonial regulatory environnement for the insurance and trading of financial security across in the west African region.
Session 5: "Driving Liquidity in African Capital Markets" has been led by Mr. Thapelo TSHEOLE, CEO, Botswana Stock Exchange and Mrs. Siobhan CLEARY, Head of Research and Public Policy, World Federation of Exchange. Introducing this session, Mr. Tsheole described the state of liquidity in African capital markets, revealing that African markets suffer from a low level of liquidity due to several factors including the limited participation of foreign investors or limited access to markets. Mrs Cleary, on the other hand, spoke about the importance of liquidity in capital market, insisting on the advantages of diversifying its base of investors.
Prof. Issouf SOUMARE, Director of the Laboratory of Financial Engineering, Laval University, CANADA and Mr. Terrence ADEMBESA, Executive Director, Nairobi Securities Exchange, facilitated the 6th session on derivatives markets. Pr. Soumaré returned to some basic notions about the derivatives markets, the categories and potential users of these markets (Bank and FIs, governments, etc). He then presented few examples of derivatives markets around the world and in Africa, as well as the aspects and opportunities of African financial markets. After Prof. Soumaré, Mr. Adembesa has shown some key elements to develop dynamic derivatives markets.
The afternoon sessions started with the 7th session titled: “Blockchain: Strategies and Applications in Post-trade" presented by Mr. Ridouane AZAGROUZE, Chief Information Officer, Maroclear. According to Mr. Azagrouze, the Blockchain would help to surpass the limits of the post-trade business model. Mr. Azagrouze has also shown the impact of Blockchain on cross-border process.
The last session and only panel of this edition focused on the future of African capital markets. The panel comprised Mrs. Selloua CHAKRI, Managing Director, SCL Advisory Ltd (Moderator), Mr. Fayçal BELYAZID, Head of Business Development & Sales, Middle East and Africa, Market Technology, NASDAQ and Mr. Reggie Middleton, Chief Executive Officer, Veritaseum. The panelists reviewed technologies such as the cloud and mobile phone-based money application, like the MPesa that have revolutionized the African financial world. According to them, the future of African capital markets relies on the adaptation of new technologies to African realities.
The 8th edition of BAFM Seminar closed its doors with Dr. Parfait Kouadio KOUASSI, Chairman of the Board of Directors BRVM - DC / BR, Mr. Karim HAJJI, President ASEA and Dr. Edoh Kossi AMENOUNVE, CEO BRVM - DC / BR, who have respectively come up on the stage, one after the other, to address their thanks to all the participants, followed by, a sumptuous farewell dinner held at the Heden Golf Club’s Hôtel.