Absa Africa Financial Markets Index: Mauritius now in possession of a new tool to gauge its financial performance in the African region

Barclays Bank Mauritius is launching the Absa Africa Financial Markets Index (AFMI) 2018 today, Thursday 22 November 2018, in collaboration with the Official Monetary and Financial Institutions Forum (OMFIF) and the support of the Bank of Mauritius (BOM). This new Index, launched for the first time by a bank in Mauritius, is a premier indicator of the attractiveness of Africa’s financial markets, for use by governments, investors, businesses, and asset managers around the world. Mauritius has outperformed many countries in the region, positioning itself as the 4th country in the Index.

Policy-makers, regulators, investors and other participants in the market can now use this tool to identify the areas and initiatives which will drive the most significant improvements. In this report, Mauritius is equally encouraged to elevate its foreign exchange market to boost accessibility and economic development. “Mauritius is seen as having a strong regulatory and legal framework and the placement on the Index is one that should spur us to move forward,” declares Ravin Dajee, Managing Director of Barclays Bank Mauritius. He strongly believes that combined efforts of all the players in the financial industry will contribute towards the greater development of not just the financial market and the economy of Mauritius, but also the economy of the African continent.

“In our transition towards Absa, our banking institution is now more focused on the opportunities on the African continent. Africa is one of the major players in the current global economy and represents high investing potentials. With the AFMI, we now aim at better positioning ourselves on the market so as to open doors for our local investors to ensure their sustainable growth that shall benefit the country’s economy,” adds Ravin Dajee. With Absa, Barclays Bank Mauritius is already navigating its destiny as an African organisation, positioning itself as a pan-African bank of choice in the region, and offering fresh opportunities for its customers.

Mauritius is now seen as a jurisdiction that attracts quality global investments which in turn reach the African continent. “We are comfortable with how Mauritius currently stands in regard to the report and we are confident that, should we keep on this track, Mauritius is likely to gain even more momentum when it comes to its participation in how the African continent can identify and capitalise across the various economic opportunities that are open to us,” adds Vishal Joyram, Head of Global Markets at Barclays Bank Mauritius. 

Maria Ramos, Chief Executive Officer of Absa Group, on her side, highlights that the development of well regulated, deep and liquid financial markets is a key priority that should be at the top of Africa’s development agenda. She explains that the index facilitates a meaningful debate about the maturity and accessibility of Africa’s financial markets. The overall note of the report is that countries are progressing with policies that support the development of financial markets across the continent. South Africa’s ‘twin peaks’ strategy for improving financial regulation and Mozambique’s ‘financial sector development strategy’ stand out among the frameworks introduced over the past year. Such initiatives have boosted performance for the index as a whole.

The greatest area for improvement across the continent remains the ‘capacity of local investors’. Excluding the top five economies, the remaining countries average a score of just 22 out of 100 in this pillar. Survey respondents highlighted that the lack of knowledge and expertise of pension fund trustees and other asset owners hinders the development of new financial products, by reducing their demand for more sophisticated assets and strategies to diversify returns. The index also shows that improvements in market infrastructure and regulatory frameworks could boost the performance of countries in the middle of the index over coming years.

The 20 economies surveyed are: Angola, Botswana, Cameroon, Egypt, Ethiopia, Ghana, Ivory Coast, Kenya, Mauritius, Morocco, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Seychelles, South Africa, Tanzania, Uganda and Zambia. The index provides a toolkit for countries wishing to build financial infrastructure by tracking progress annually across six pillars: market depth; access to foreign exchange; tax and regulatory environment and market transparency; capacity of local investors; macroeconomic opportunity; and enforceability of financial contracts, collateral positions and insolvency frameworks.

The index can be viewed here.