Roland Berger examines renewal of Exchange in Gabon

02 September 2015 Consultancy.uk

Gabon, in Central Africa, is seeking to re-develop its stock exchange – the BVMAC* – such that it enables the local companies and institutions of six small African nations to issue bonds and stocks. For the redevelopment of the exchange, the Financial Market Supervision Commission of Central Africa has hired Roland Berger to perform a feasibility study.

The BVMAC was set up in 2003 in Libreville, Gabon, to allow six countries, with each minor financial clout but populated by more than 40 million people, access to a financial market. The institution aims at providing governments and companies in the CEMAC** area with financial facilities as well as creating a system of transparency for users.

Although the exchange opened in 2003, competition with Cameroon’s DSX Douala Stock Exchange resulted in a slow start and the institution only became fully operational in 2008, after its back-office and trading platform functionality became viable. Since then, while the bond market has been relatively active, the stock market has so far managed to attract only one company SIAT, the Gabonese agro-food group.

COSUMAF hires Roland Berger

At the time of SIAT’s listing, in 2013, it was hoped that the company would help propel the exchange into wider use within the area. According to Pascal Houangni Ambouroue, Head of the BVMAC in 2013, issues have for the majority been with banks and financial institutions, rather than active traders. The equity issue it was hoped would “liven up trading.” However, this has not eventuated.

Restarting the exchange
In a bid to re-enliven the exchange, the Financial Market Supervision Commission of Central Africa (COSUMAF) has decided – with financial support from the World Bank – to seek a way forward. The COSUMAF hired consultancy Roland Berger to conduct a study on the potential of the financial market of this region. The firm will, as part of the project, meet with various authorities including ministerial, business organisations, chambers of commerce, companies from the state portfolio, private companies and financial companies. The aim of the study is to make the exchange functional and competitive with its neighbour.

The consulting firm will deliver its findings to the COSUMAF who will make a decision on how to revitalise the region and the feasibility of the exchange.

* Bourse des Valeurs Mobilières d'Afrique Centrale.

** Economic and Monetary Community of Central Africa.