Read ASEA’s annual report for 2008 and a total of USD10,000 was received from its 20 member exchanges – a total of USD500 each. What is this if not an indication of the confidence that Africa’s stock exchanges have in the association and the resources available to it? Yes, the member exchanges have utlilised their own resources to assist in managing ASEA, but I think that ASEA is just a white elephant. Here is why:
A review of the stated objectives of ASEA versus outcomes shows that very little has been achieved since its inception 12 years ago. And this perpetual non-achievement is due to continue. In 2008, ASEA participated in an African Union workshop for the establishment of a pan-African stock exchange “where a gradual approach to its implementation was recommended”. Why can none of the decision makers involved in these events see the fragmented manner in which regional markets are developing and tell it like it is: There is no hope for a pan African stock exchange anytime soon? Anyone who suggests otherwise is purely there to ride the wave of free financial grants to enhance their airmiles status. ASEA’s annual conference, the highlight of every year, never results in any subsequent action or achievement. ASEA is discussing exactly the same issues that they were discussing in 1997.
Or perhaps ASEA has achieved a lot and has just not been able to communicate it to the market through its website or any other means? This is what the Chairman Maged Shawky says about the ASEA website:
“…we attach a great value to ASEA website, launched under the URL www.africansea.org, as well as the ASEA Yearbook, first released in 2006, as a summary reference for ASEA members, to serve as marketing tools to attract interest to the African region.”
The 2008 annual report goes further to state:
“To enhance the ability of ASEA in providing a credible and central source of information on the Association and its members, ASEA website was upgraded several times to have a more user-friendly interface, updated information and useful features that best serve all users. The website provides a medium that highlights ASEA programs and latest achievements, together with members’ profile, news, trading data as well as direct links to their websites.”
The website is out of date, incomplete (contrasting sharply with the “comprehensive” information ASEA undertook to present) and no responses were provided to any of the email communications to the stated representative contacts. I will not go into any detail but there is plenty of it.
The primary objects of ASEA also include the sharing of information and marketing and establishing markets, but 25% of the 20 stated member exchanges profiles do not exist in the 2008 annual report: namely, BRVM, Casablanca, the Libyan Stock Exchange, the Swaziland Stock Exchange and the Zimbabwe Stock Exchange.
Apparently an ASEA 2008–2010 corporate plan was prepared but this consists of little other than the establishment of three “task forces” on corporate governance, integration in Africa and promotion and marketing. Without a practical focus, financial resources and insight into what is actually needed in African markets to promote investment, ASEA has no hope of achieving anything significant other than the right of passage of its members to the annual conference.
Africa Investor has partnered with ASEA in its annual awards in the mistaken belief that it adds credibility to their excellent initiatives. In fact, in essence, the complete absence of substance to ASEA is not the issue. ASEA provides its office bearers with a pan-African appearance whilst at the same time avoiding the country-on-country politics that typifies how Africa’s regulators have carved up their respective markets.
If ASEA only had one core task, that of ensuring and promoting standards of information availability, that would suffice. But they want to change Africa in all respects. Wrong approach. Our free portal of annual reports www.africanfinancials.com is achieving more investment promotion in two days than ASEA has achieved on over a year: We have over 100 visitors a day ASEA has had 169 visitors to its site in a whole year according to its ticker.
Stock exchanges with any semblance of common sense should withdraw their support from ASEA (what support you may ask?) until a practical and common sense strategy is adopted that actually promotes investment.
So what is a “practical and common sense strategy”:
- Sort out the membership fee structure (this has been on the table for some time now) and how it is invested: Just a little from each exchange would go a long way if an internet platform were core to strategy, i.e. forget secretariats, vast travel budgets and the like, spend on practical things like a decent website and ensure it is up to date.
- Focus, and focus on something both sensible and achievable: information availability. This is practical. It adds value. All the rest such as corporate governance, integration etc. have been or are currently being flogged to death by overpaid traveling consultants that understand very little about what is actually needed to do something instead of talk about it. After five years or so, another theme could be adopted. Being all things to all men is rubbish. The internet is changing the world and Africa’s regulators are fast asleep.
- Outsource managing the strategy set out by the ASEA board to a qualified company.
It’s that simple.