More than 300 policymakers, central bankers, institutional investors, and capital market regulators from over 20 African nations have gathered in Nairobi for the third Sustainable Capital Markets Conference. The conference, organized by FSD Africa and regional partners, aims to accelerate domestic resource mobilization to bridge the continent's widening development and climate financing gaps. African economies are facing significant challenges, including tightening global financial conditions and reduced overseas development funding.
The conference takes place at a critical juncture for African economies, as governments confront slowing foreign direct investment and elevated debt-servicing burdens. In response, delegates are focusing on developing domestic capital markets to unlock the estimated $4 trillion in domestic assets. This approach is seen as crucial for reducing reliance on external funding and promoting sustainable economic growth.
Although African domestic equity markets have expanded significantly since 2000, growing 27-fold to reach $561 billion, the continent's share of global capital market activity has declined relative to international benchmarks. This decline highlights the need for further development of domestic capital markets to increase their contribution to the global economy.
Debt capital markets remain particularly shallow in Africa, with fewer than half of African countries seeing a domestic corporate bond issuance since 2000. This underdevelopment limits the ability of African companies to access long-term funding, hindering economic growth and development.
The Sustainable Capital Markets Conference provides a platform for policymakers, investors, and regulators to share knowledge, best practices, and innovative solutions for developing domestic capital markets. By leveraging domestic resources, African countries can reduce their reliance on external funding and promote sustainable economic growth.
The conference is a collaborative effort between FSD Africa and regional partners, demonstrating the importance of partnerships in promoting sustainable capital markets in Africa. The event aims to facilitate dialogue and cooperation among stakeholders to address the challenges facing African capital markets.
The development of domestic capital markets is seen as a critical step towards achieving sustainable economic growth in Africa. By unlocking the estimated $4 trillion in domestic assets, African countries can promote economic development, reduce poverty, and improve living standards.
Key points
- Over 300 policymakers and investors gather in Nairobi to discuss development of domestic capital markets
- African domestic equity markets have expanded 27-fold since 2000 to reach $561 billion
- Debt capital markets remain shallow, with fewer than half of African countries seeing a domestic corporate bond issuance since 2000
