Abuja — Nigeria's President Olusegun Obasanjo Thursday called on African countries to take action to address the deficiencies in infrastructure that now impede the growth of the capital market in the continent.
In an address at the start of the Annual Conference of the African Stock Exchanges Association here, the Nigerian leader said the theme of the conference posed a challenge to the international investors to explore the investment opportunities in Africa.
The theme of the conference is: African Stock Markets: Investment Opportunities and Technological Challenges of the 21st Century.
Represented by Vice-President Atiku Abubakar, Obasanjo said the theme of the conference also reminded African countries of the need to address the infrastructural and technological constraints that inhibit the full realisation of the potentials of their capital markets.
Obasanjo said the government of Nigeria recognised "the strategic linkage that prevails between a democratic and free market dispensation and the willingness of the international community to enter into any of the emerging markets."
"Therefore, we will support the full development of the Nigerian Stock Exchange. We hope that other regions will do likewise."
Many African countries have initiated economic reform programmes aimed at improving performance of their national economies, but the Nigerian leader said the objective of rapid economic development cannot be achieved "in the present circumstances without a radical, and sometimes, painful, restructuring and deregulation of key aspects of our economies, and opening them up for international participation."
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
Nigeria is currently implementing a privatisation programme, as part of its economic reforms. Obasanjo said the Nigerian Stock Exchange has played a "key role" in the first stage of the process, and promised that during the second phase of the programme, "many of the enterprises scheduled for privatisation will be disposed of through the stock exchange."
The conference is taking place against the background of the need to develop and integrate stock markets in Africa though technological innovations.
There are currently 18 stock exchanges in Africa, but only two - those of Nigeria (the Nigerian Stock Exchange), and South Africa (the Johannesburg Stock Exchange) - are said to be fully developed with automated trading systems.
The other exchanges are currently operating the "call-over" system, under which the call-over Chairman reads out names of quoted companies and invitesbrokers to make offers and bids. Apart from being slow, this system is also said to be inefficient in the pricing of securities.
