15 MEMBER nations of the Economic Community of West African States (ECOWAS) will launch a unified cross-border debt market by 2023.
This is in their bid to deepen economic integration in the region through an increase in trade and services.
The Director-General of Ghana’s Securities and Exchange Commission, Daniel Ogbarmey Tetteh, made the announcement in an interview with Bloomberg recently.
Tetteh noted that to make the plan possible, regulators and stock exchanges from ECOWAS are working to put in place a passport system that would allow broker-dealers to trade across the different markets, citing that more access to lending pools would reduce borrowing costs in the region.
“One major advantage is that you get a bigger base of investors bidding for a country’s bonds,” Tetteh said.
Tetteh added that it would deepen economic integration in the region, of nearly 400 million people, and “key to the success of the debt-market plan will be making sure that the countries are on an equal footing in terms of systems and processes.”
He said the dream of the project is to set up a virtual convertible secondary market for bonds and stock where foreign currencies can be traded through the cross border system until ECOWAS agrees on a single currency.
According to Bloomberg, debt prices across the region vary as 10-year debt in local currency range from 5.9% in Ivory Coast and 12.7% in Nigeria to 19.7% in Ghana.
