EAC exchanges call for fast-tracking of capital markets integration to atract more investors

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The long-awaited automation of Rwanda Stock Exchange is in its final stages.

The east African Securities Exchanges Association (EASEA) has commended the current developments on the regional infrastructure and tasked its technical committee to fast-track implementation of the capital markets infrastructure to provide new possibilities for investors seeking cross-border trade opportunities.

This was during the EASEA 29th meeting in Nairobi, Kenya on Friday that brought together regional exchanges chiefs from Rwanda, Kenya, Tanzania and Uganda. Geoffrey Odundo, the CEO of the Nairobi Securities Exchange (NSE) that hosted the meeting, said it is crucial to strengthen the region’s financial markets to attract more investors and increase their liquidity.

“An integrated market is critical for attracting foreign investors and increasing liquidity of the region’s market, and as a member of the association, CDSC therefore remains committed towards achieving this key milestone,” added the Central Depository and Settlement Corporation’s (CDSC) head of ICT, James Gikonyo.

Speaking at the event, Pierre Celestin Rwabukumba, the Rwanda Stock Exchange (RSE) chief executive officer (CEO), said robust and integrated markets are key to achieve the goals of the East African region’s economic development.

RSE automation

Rwabukumba told the meeting that RSE was in the final stages of automation of its trading infrastructure, which will automatically be linked to the Central Securities Depository (CSD) and Real Time Gross Settlement System (RTGS) at the Central Bank of Rwanda.

Last year, Rwanda launched a 10-year master plan for capital market development. The plan focuses on product development, technology and innovation, capacity building and investor education, savings mobilisation for the retail investors, and regional integration. This initiative is in line with Rwanda’s ambition of becoming a financial services hub in the East and Central Africa region.

EASEA projects

Capital markets infrastructure project is one of the initiatives by EASEA geared at enabling regional exchanges to attract global capital flows and participate in global capital markets.

It also seeks to enable the East African exchanges to adopt a mutual, modern technological system that will meet different market needs as capital markets are increasingly becoming automated and interconnected.

Therefore, this innovation will boost the foundation for the regional integration of the capital markets, according to EASEA officials.

Meanwhile, the regional exchanges are pushing for more capacity building of key players particularly intermediaries. This is geared at growing the skills and technical capacity of the market players in order to meet regional and global standards.

EASEA strategic Initiatives

EASEA was established in 2010 with the primary objective of promoting the growth and development of capital markets in the East African Community and on the African continent, generally. It also seeks to foster mutual assistance and cooperation, including the sharing of information among member states.

The EASEA secretariat has adopted key strategic initiatives as they look to develop a five-year strategic plan. These initiatives are aimed at increasing the product offering of each market; building the capacity of market intermediaries, as well as ensuring continuous public education and awareness campaigns, and supporting integration of market infrastructure.