ECA workshop boosts African stock markets
By Cristina Müller, Communication Officer, ECA

Abuja - Capital markets, especially stock markets, are essential for mobilizing financial resources for the development of the private sector. With a stronger private sector African countries can generate sustained economic growth and create jobs.

To improve their skills, stock market practitioners and regulators will participate in a two-day capacity building workshop sponsored by the Economic and Social Policy Division (ESPD) of the United Nations Economic Commission for Africa (ECA) from 12 to 14 December in the Nigerian capital, Abuja.

“The development of capital markets in Africa is constrained by a number of issues: among them the lack of appropriate conditions for establishing new stock exchanges or for improving existing ones,” said Emmanuel Nnadozie, head of the Macroeconomics and Finance team of ESPD.

In addition, he said, a shortage of financial technocrats and absence of training institutions limit the development of securities markets, especially in emerging small markets.

The third workshop of its kind, following two sub-regional workshops on capital markets held in Johannesburg in 2003 and in Cairo in 2004, this meeting is part of a larger strategic plan undertaken by the ECA in partnership with key stakeholders within African finance ministries, central banks and stock markets and specialists to mitigate the conditions that limit the development of Africa’s capital markets.

Following the Abuja training for Anglophone West Africa, other capacity building workshops are scheduled for Francophone West Africa and an All Africa Forum will be held late next year.

Under the auspices of a major African Capital Markets Development Programme, launched by the ECA in 2002, activities are designed to build capacity in existing capital markets by developing or enhancing human resources, institutional processes, regulatory frameworks, and physical and technical infrastructure at both national and regional levels.

In promoting the development of capital markets in Africa, ECA has so far collaborated and forged strategic partnerships with organizations and institutions, interested in the development of Africa''s capital markets, including the United Nations Conference on Trade and Development (UNCTAD), the African Capital Markets Forum, the Rand Merchant Bank, the Cairo and Alexandria Stock Exchanges and JP Morgan.

“To increase the impetus for capital markets on the continent, the UN and its African partners have been increasing educational activities, creating public awareness, supporting the development of institutional investors such as unit trusts and pension funds, and training key market-players as brokers-dealers and fund managers,” said Mr Nnadozie.

It has also been necessary to upgrade the knowledge and understanding of regulators on the efficient regulation of markets.

As a tool for enhancing knowledge of markets and their use, ECA has produced a training manual for capital markets practitioners, which will be used for the first time during the Abuja workshop.

The manual provides a comprehensive view of capital market institutional and operational infrastructure and serve to assist practitioners in acquiring or upgrading skills with regard to trade, investment management and advisory services, corporate finance, market information systems and services, transaction clearance and settlement systems, securities transfer, registration and custody, debt rating and so on. While the practitioners’ workshop focuses on operational aspects, trainees will also be introduced to regulatory compliance.