Capital Markets
From The Report: Ghana 2018
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The Ghanaian capital markets showed promising signs of a steady recovery over the course of 2017, as the country saw an improvement in key macroeconomic indicators. Moreover, a return to strong growth, along with the steady issuance of new government bonds, has provided a boost to the Ghana Stock Exchange (GSE). The country’s capital markets are benefitting from a wide range of reforms, including to pensions, which swill help loosen domestic capital and improve liquidity, listings and trading. As the country begins a new cycle of growth and investment, the GSE is likely to play an increasingly important role in financing domestic development.

The chapter contains an interview with Kofi Yamoah, Managing Director, Ghana Stock Exchange; and a viewpoint from Roger Adjovu, General Manager, Liberty Capital.

Articles from this Chapter

Overview

Taking stock: Following signs of wider economic recovery, the Ghanaian bourse looks set to benefit
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After a cyclical lapse lasting two years, Ghanaian capital markets showed promising signs of a steady recovery during the course of 2017. The first year of the government of President Nana Akufo-Addo has seen an improvement in key macroeconomic indicators and a return to strong growth, which along with the steady issuance of new government bonds, has provided a boost to the Ghana Stock Exchange (GSE). The GSE is also benefitting from government policies to strengthen and deepen the role…

Interview

Exchange of ideas: Kofi Yamoah, Managing Director, Ghana Stock Exchange (GSE), on upcoming changes and improvements in the marketplace
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Interview: Kofi Yamoah What can be done to help further incentivise initial public offerings on the GSE in 2018? KOFI YAMOAH: The exchange will continue to promote listings through education and awareness campaigns, which should emphasise the benefits of raising capital and listing on either the main market or the Ghana Alternative Market (GAX) for small and medium-sized enterprises (SMEs). We accomplish this goal through increased research, publicity and advertisement. We have also created a listing…

Analysis

Attractive offerings: Despite some investment challenges, the bourse is finding ways to attract new listings
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As is the case in emerging and frontier markets the world over, for the Ghanaian capital markets to play a key role in the domestic economy, new listings of companies on the Ghana Stock Exchange (GSE) are needed. This is no easy proposition in economies where companies are frequently privately held, with family owners and investors tending to adopt sit-and-hold strategies, thus limiting valuation growth. In 2016, despite adverse market conditions, two financial institutions carried out initial…

Viewpoint

Financing development: Roger Adjovu, General Manager, Liberty Capital, on how capital markets could be used to leverage government initiatives
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Viewpoint: Roger Adjovu The One District, One Factory initiative is a key component of the current administration’s industrial transformation agenda. It is designed to set up at least one medium- to large-scale industrial enterprise in each of Ghana’s 216 districts. This programme will stimulate local economies by creating employment for the youth in rural and peri-urban communities, improving income levels and standards of living, and reducing rural-urban migration. Another key objective…

Analysis

Debt market: Government focuses on increasing long-term debt securities to ensure greater bond market stability
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After a smooth transition of power, the new government, in an effort to reduce income shocks that could affect future financing costs, restructured its debt profile by introducing 15-year domestic bonds to the market. A total of GHS207bn ($50bn) in securities were issued by the government of Ghana, the Ghana Cocoa Board, the Bank of Ghana and various corporate firms in the year to the end of September 2017. In the same period in 2016, the outstanding value of short-term debt securities decreased considerably, while those of the seven-, 10- and 15-year instruments increased, as the government sought to taper existing short-term debt securities. With…

Analysis

Equity market: Positive trading performances across the board despite some suspensions for listed firms
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The Ghana Stock Exchange (GSE) ended September 2017 with the market index at 2326.09, representing a year-to-date (YTD) change of 37.71%, compared to -11.03% in the same period of 2016. The GSE Financial Stocks Index, which tracks the performance of financial stocks, settled at 2043.5, representing a YTD change of 32.23%, as compared to -12.82% at the end of September 2016. This strong growth is a result of improved economic activities, with GDP (including oil) for the first quarter of 2017 growing 6.6% year-on-year, up from 4.4% growth in the same period of 2016. Falling fixed-income yields made the equities market an attractive alternative for…