Bourses in Africa plan to cross-list more exchange-traded funds (ETFs)

South Africa, Nigeria and Kenya are planning to cross-list more exchange-traded funds (ETFs) on their stock markets to boost liquidity of the securities, according to the JSE.

“We reached out to East Africa and West Africa,” said the JSE’s business development manager, Tamsin Freemantle, in an interview last Thursday in Nairobi. The JSE is “working closely with those markets to develop this cross-listing”, she said.

African exchanges are looking to increase co-operation as companies from Botswana to Nigeria list their shares on other bourses. The JSE, with a market value of R10.7-trillion, has rallied 8.9% this year in the best performance after Botswana among 14 sub-Saharan exchanges tracked by Bloomberg.

Nigeria’s main index has dropped 0.6%, and the Nairobi all-share measure is up 3%.

In 2011, Johannesburg-based Absa Capital, a unit of Barclays Africa Group, listed its NewGold ETF on the Nigerian Stock Exchange. The West African nation now has four ETFs, and the JSE has 45, according to Ms Freemantle.

The Nairobi Securities Exchange is awaiting regulatory approval to offer the asset class, said the head of market product and development, Donald Ouma. “Once we have the ETF framework, we will be ready to have the gold and platinum ETFs by Absa cross-listed in Nairobi.”

The JSE is sub-Saharan Africa’s biggest exchange by market value followed by that of Namibia, Nigeria and Kenya.