The Chairman of the Board of the Mozambique Stock Exchange (BVM), Salim Valá, said last Friday (11) that, as the stock exchanges are fundamental institutions in market economies, in the medium term, they can assume the role of powerful engines for promoting economic integration and attracting investment in Portuguese-speaking African Countries (PALOPs).
“Stock Exchanges, as alternative platforms for financing, should contribute to changing the paradigm and narrative of the economic system that is currently affected by many crises including the rise in inflation and interest rates, increased credit risks and the fact that the real economy is facing increasing difficulties in accessing financing on favourable terms,” the source explained.
Speaking at the 25th anniversary conference of the Cape Verde Stock Exchange, held in Praia, on a panel entitled, “The Role of the Capital Market for African Economic Integration,” he noted that the existence of a partnership between exchanges could generate positive effects capable of solving specific funding problems and contribute to increasing the size of the market.
The head of BVM said that African exchanges were still small, with low liquidity and trading volume and little depth.
“Our intention is to turn the stock exchanges into an effective barometer of the economy that helps businesspeople to enhance corporate governance, to produce more and better, to leverage productivity and profitability of companies, to generate more jobs and income for families and to expand the tax base. We want to be the pivot and the nerve centre that enables us to lubricate and make inclusive and ethical businesses viable,” he said.
Also in his speech, Salim Valá said that the memorandum of understanding signed in 2022, in Maputo, between the BVM, the Cape Verde Stock Exchange (BVC) and the Angola Debt and Securities Exchange (BODIVA) was being implemented and was already seeing results in terms of management experience, financial literacy, training of human resources and introduction of new financial products and services.
“But we have to be more assertive to fully exploit the opportunities that also exist, including in the field of technological increment, in the improvement of the regulatory framework, in the field of good intermediation practices, in the experiences of regulation and supervision of the capital market, in strategies to attract foreign investors and in fostering the internationalisation of companies,” he added.
The CEO of BVM emphasised that the strategic partnership between the three institutions brings many advantages and opportunities, but there are also challenges “such as, for example, changing the financial culture that is very much dominated by the banking system, improving incentives for intermediation and issuers, improving the quality of demand for capital market products, harmonising the regulatory framework and undertaking the relevant technological reforms”.
Salim Valá invited Cape Verdean entrepreneurs and investors to invest in Mozambique and take advantage of the existing economic opportunities.
