The African Exchanges Linkage Project (AELP) has entered into an agreement with seven of Africa’s leading stock exchanges to boost pan-African investment flows and bring more liquidity to African stock markets.
Ideally, the African Securities Exchanges Association (ASEA) also signed a contract to procure an order-routing system to help improve trading among African markets. However, this contractual agreement has brought cross-border trading from one African securities exchange to another, a step closer.
Meanwhile, the contract is for the design and rollout of the AELP Link technology platform for routing orders and trade confirmations between stockbrokers on the seven Exchanges participating in the pilot phase of the AELP.
The Supplier is DirectFN. DirectFN global IT firm is experienced in capital markets solutions across the Middle East and many emerging and frontier markets, and was awarded the contract after a competitive bidding process that attracted applications from top international suppliers in 18 countries.
Meanwhile, the President of ASEA and CEO of the BRVM, Dr Felix Edoh Kossi Amenounvé, explaining how the AELP Link is expected to run, noted that an investor’s order in one market will be channelled by a domestic stockbroker through the AELP Link to a stockbroker on the foreign market where the security is listed for execution in the foreign market. He further revealed that African Listed Securities to be accessed through the AELP Link include all securities that are available for cross-border investors.
Moreover, equity investments available include Africa’s most promising and profitable businesses as well as some global leaders among more than 1,050 companies listed. Investors will also buy or sell corporate and government bonds, exchange-traded funds (ETFs) and derivatives where these are listed on the participating Exchanges and the sponsoring stockbroker provides access.
Dr Felix Edoh Kossi Amenounvé, President of African Securities Exchange Association (ASEA) and CEO of the BRVM, expressed his excitement and lauded the initiative stating, it will create new opportunities for Africa’s stock exchange market.
“We are excited with this big step towards free movement of investments across Africa and free flow of capital. Our aim is to open new opportunities for individual and institutional investors to invest productively into Africa’s growth story. The Exchanges continue to support African enterprises and governments to raise long-term capital for African jobs, business growth, infrastructure and development.”
Dr Felix Edoh Kossi Amenounvé
In addition, his counterpart Dr Walid Al Ballaa, the Managing Director of DirectFN also expressed the same sentiment about the new technology saying, “With innovative technology and focus to bring digital maturity in building digital relationships through the AELP-Link technology platform establishment, DirectFN feels equally excited to assist practically in realizing the goals across the participating African Exchanges and to enable the African capital market ecosystem digitally to create positive impact on the overall economy.”
However, the AELP is a joint initiative by ASEA and the African Development Bank (AfDB) aimed at unlocking Pan-African investment flows, promoting innovations that support diversification for investors, and addressing depth and liquidity in the markets. It is funded by a grant from the Korea-Africa Economic Cooperation (KOAFEC) Trust Fund managed by the African Development Bank.
Meanwhile, some of the AELP exchanges that forms part of the agreement includes: Casablanca Stock Exchange, The Egyptian Exchange, Johannesburg Stock Exchange, Nairobi Securities Exchange, Nigerian Exchange, Stock Exchange of Mauritius and Bourse Régionale des Valeurs Mobilières.
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