The Nairobi Securities Exchange (NSE) emerged as the best performing stock exchange market in Sub-Sahara Africa in the last decade beating its rivals, the Johannesburg Stock Exchange and the Nigerian Stock Exchange. The Nairobi benchmark index went up by 74 per cent in the last ten years, while Johannesburg Stock Exchange index increased by 9 per cent only. In contrast, the Nigerian Stock Market benchmark index declined by about 50 per cent in the period under review.
The MSCI Frontier Markets index which measures the general performance of frontier markets such as Kenya, Tanzania, Zambia, Namibia, Egypt, Morocco, Senegal, and Tunisia improved by 12% in the period starting from 1st January 2010 to 31st December 2019.
The Nairobi based exchange is set to link up with six African exchanges in an effort to increase activity on the stock market. NSE is a member of the African Securities Exchanges Association.
According to the Association’s President Karim Hajji, stockbrokers on the Nairobi Exchange will be able to place orders on the Casablanca Exchange, Johannesburg Stock Exchange, Nigerian Stock Exchange, Egyptian Bourse, Exchange of Mauritius, and the Abidjan Exchange and vice versa starting from 2021.
“This initiative is supported by the African Development Bank, which has contributed funding of up to $1 million, notably for the system that will help us connect the seven exchanges…” Hajji told Bloomberg.
In addition to the contribution from the African Development Bank, the International Finance Corporation is financing a study on the potential of listing state corporations on African Stock Markets. The move will boost capital markets in Africa and drive economic growth in the continent.
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Banks main drivers of activity at NSE
