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Intergrating East Africa’s Markets
To forward its integration agenda, the East African Securities Regulatory Authorities group is seeking to create a harmonized licensing framework for the region for brokers and dealers, and has also approved draft regulations on book-building for adoption by its members. Key policy initiatives under this scheme include:
• Ensuring strong, broad-based growth in community countries – Apart from the important ingredient of sound macroeconomic management, this raised questions of how to effectively implement the community’s customs union and common market to promote regional investment and trade.
• Promoting closer integration of the community’s financial markets –Electronic banking has been an area of success but the more traditional banking and capital markets remain segmented.
• Establishing budget management and drawing lessons from the euro-zone on the fiscal requirements for effective monetary union.
• Harmonizing monetary and exchange rate policies during the transition to monetary union.
The changes are part of ongoing efforts to standardize capital market regulations across East Africa to make it easier for businesses to tap into regional capital markets. Despite the region’s recent success in attracting FDI, even through the global financial crisis of 2008, regionalization of financial markets is essential to maintaining its standing as a investment destination.
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