Ghana Drops 6 Places In African Financial Market Rankings

A 2019 update of financial markets index rankings by the Amalgamated Bank of South Africa (ABSA) has seen Ghana slip six places in its attractiveness to investors.

Out of a total of 20 African countries assessed, GH ranked 13th, slipping from its previous 7th position by six places in the immediate aftermath of the financial sector reforms that has seen many banks and financial houses closed down.

Authors of the report describe Ghana’s slip as the result of, “low wholesale foreign exchange market turnover” despite making some strides in the area of attractive tax environment.

Head of Global Markets, Absa Regional Operations, George Asante, has also chimed an explanation, claiming that Ghana’s drop does not necessarily mean that its overall performance was poor but that other countries have outpaced GH in the matter of cogent reforms in their financial markets.

“For instance, if you look at the individual pillars, you will realize that Ghana shot up especially in Market Depth, Liquidity of instruments issued on the stock Ghana Stock and by government. This is what we should also look at,” he stated.

With the slip coming on the heels of the financial sector clean-up by the Akufo-Addo administration, the development has naturally put these reforms into questionable perspective. However, Mr. Asante downplayed the rippling effect, saying reforms take time to impact.

The 2019 ABSA Index tracked performances of financial markets in 20 African countries on six main pillars – Market depth, Access to foreign exchange, Market transparency and regulation, Capacity of local investors, Macroeconomic opportunity and Enforceability of international financial agreements.

South Africa, Mauritius, Kenya, Namibia, Botswana, Nigeria, Tanzania, Zambia, Rwanda, Uganda, Egypt, Morocco, Ghana, Seychelles, Mozambique, Ivory Coast, Angola, Senegal, Cameroon and Ethiopia were the countries surveyed.

SA topped the index due to its sizeable lead in ‘Market Depth’ followed by Mauritius, Kenya, Namibia, Botswana and Nigeria in that order.

Absa, formerly Barclays Africa Group Limited, and originally Amalgamated Banks of South Africa, started the index in 2017. It says in the two years that the index has been operating, countries have taken steps to align their local market infrastructure with global standards. Absa Group Limited is an African based financial services group, offering personal and business banking, credit cards, corporate and investment banking, wealth and investment management as well as bancassurance. It is the majority shareholder of 11 banks spanning Botswana, Ghana, Kenya, Mauritius, Mozambique, Seychelles, South Africa, Tanzania (two entities), Uganda and Zambia, with a further two representative offices in Namibia and Nigeria.

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