Mobilizing funds for Africa’s economic development
Abidjan, 13 July 2016 – The African Development Bank (AfDB) and the African Securities Exchanges Association (ASEA) signed earlier this week, a five-year Memorandum of Understanding (MoU) to amplify the impact of their strategically aligned joint efforts to promote resources mobilization to fund Africa’s economic growth.
This MoU will provide a collaborative framework for harmonizing and coordinating the efforts of AfDB, Africa’s premier development finance institution, and ASEA, the apex body of African stock exchanges, towards deepening and connecting African financial markets.
The partnership will facilitate various projects of mutual interest to both the Association and the Bank targeting areas such as financial markets infrastructure development, introduction of new products in the market, improving market liquidity and market participation, information sharing and capacity building, among other programmes. The Bank and ASEA have already started successfully collaborating on the African Exchanges Linkage Project, which they co-initiated to improve liquidity and foster greater investments and trading across markets.
The President of AfDB, Dr. Akinwumi Adesina is convinced that the deepening and integration of Africa’s financial markets, to mobilize domestic resources to fund African economies is very important to deliver the Bank’s High 5s priorities – Light up and Power Africa, Feed Africa, Industrialize Africa, Integrate Africa and Improve the Quality of Life of Africans – all of which embody core elements of the 2030 agenda for the attainment of the Sustainable Development Goals (SDGs).
The President commended the strides made by the Bank in financial markets development through local currency bond issuance and their listing for example in Uganda, Nigeria and South Africa, thereby contributing to the deepening of those markets. Likewise, the work undertaken by the Bank through the African Financial Markets Initiative (AFMI) to support the development of domestic bond markets in Africa through the African Financial Markets Database, and the soon to be launched African Domestic Bond Fund building on the success of the AFDB Bloomberg® African Bond Index.
He acknowledged that capital market development still requires to be enhanced. Dr. Adesina welcomed the partnership with ASEA to leverage the huge pools of capital available in sovereign wealth funds, pensions and insurance for the development of Africa through appropriate intermediation through capital markets products. Additionally, he called for “increased mobilization of domestic pools of savings and support for small and medium enterprises (SMEs) as they constitute the bulk of Africa’s private sector.”
ASEA President, Oscar N. Onyema, said the partnership between AfDB and ASEA will complement the Association’s obligation of promoting the activities of its members and of the African Capital Market through combined efforts. The MoU will pave way to various projects that will focus on the development of exchanges, deepening the stock markets and ultimately fuelling African economic growth.
The AfDB and ASEA are devoted to see the continent achieve its full economic potential through a continuous robust relationship.