The Africa Board: How the Mauritius Stock Exchange innovates!

With a strong growth record and increasingly substantial international presence, the Mauritius Stock Exchange has become an attractive platform for Africa-focused ventures. Now, with its sights firmly set on future growth and innovation, the launch of the new Africa Board continues to position it as a preferred partner for companies that want to raise capital and list on a flexible, multi-currency platform – all in the financial hub of Africa.

From humble beginnings to financial hub

In 1989, the Mauritius Stock Exchange (SEM) started its operations in the Official Market with only five listed companies and a market capitalization of nearly USD 92 million. Since then, the size of the market capitalization-to-GDP ratio grew from less than 4% in 1989 to a current market ratio exceeding 75% – all in an economy that has witnessed a 5% average growth rate during the last 25 years.

Following a steady growth journey, the SME implemented its internationalization strategy in 2009 which aims to increase the number of securities listed and traded on the SEM and position the Exchange as an attractive listing and capital-raising platform for international securities. In the wake of this implementation, the SEM has listed a diversified spectrum of products spanning various asset classes. A noticeable outcome of SEM’s internationalization strategy is the listing of a growing number of issuers which have an Africa-focus.

Growth with international sights set on Africa

Since the implementation of this strategy, out of the 156 new listings and 87 new GBC/international securities listed, 29 listings are Africa-focused securities. These Africa-focused issuers have leveraged the SEM’s multi-currency listing, trading and settlement platform to raise MUR 45 billion to fund their activities.

A total amount of MUR 227 billion (USD 6.5 billion) has been raised on the SEM’s platform since 2009, out of which MUR 175 billion (USD 5 billion) has been raised by global businesses and international companies.

Dedicated to a journey of innovation, SEM decided to implement two new initiatives with a view of reinforcing its emergence as an attractive and compelling platform for capital raising, listing and trading of Africa-focused ventures.

The role of the Africa Board

A dedicated Africa Board was launched on 19 October 2018 which showcases SEM’s listed issuers and products that have an Africa-centric orientation. This initiative aligns SEM’s strategy with the national agenda of positioning Mauritius as a financial services hub for Africa.

The formation of the Africa Board aims to engage key roleplayers that want to raise capital and list on SEM’s cost-effective and flexible multi-currency platform, including:

  • GBC companies with an African focus
  • Exchange-traded funds holding African underlyings
  • Issuers of African depositary receipts
  • African debt products

The success of this initiative will enhance SEM’s and Mauritius’ image as an attractive service platform of substance for Africa.

Benefits of the new SEM-AFRIDEX

On 1 November 2018, the SEM also launched its Africa Index (SEM-AFRIDEX), which is designed to track the time-series performance of selected equity products listed on Africa Board of the SEM. These include products that have a geographical focus on the African continent (excluding Mauritius).

SEM-AFRIDEX will showcase these issuers, enhance their visibility and confirm the attractiveness of the SEM as a compelling capital-raising and listing platform for Africa-focused companies. It will also enable investors wishing to invest into the continent through Mauritius to track the performance of these companies more easily.

The SEM is also adding a new dimension to its innovative drive by promoting a conducive environment for the establishment of links with international Central Securities Depositories (CSDs) like Euroclear and Clearstream.

Why Mauritius?

The launch of the Africa Board and SEM-AFRIDEX is an exciting opportunity for investors wishing to invest in an African country that is secure, stable and well-regulated.

Mauritius is also well poised to be the risk-mitigating platform that would provide the security and peace of mind to investors with 23 Investment Promotion and Protection Agreements (IPPAs) signed with African states, which include clauses for protection against expropriation, compensation for losses and free repatriation of capital profit.

For more information about how our team can help you list your company on the Africa Board please contact Osiris on +230 650 4030