Mlambo, Chipo and Biekpe, Nicholas (2001): Investment Basics XLIV: Review of African stock markets. Published in: Investment Analysts Journal , Vol. 54, No. 5 (December 2001): pp. 61-65.
Download (530kB) | Preview
African stock markets have rapidly increased in number since 1989. This rapid increase came with the efforts to privatise state-owned enterprises. African markets are still young and segmented and lack contagion with global emerging markets. Expected returns are quite high on African stock markets making them attractive to international investors. However, African markets are also characterised by poor liquidity and market inefficiency. This, coupled with unfavourable laws and regulations, political instability, foreign exchange and convertibility risk, taxation, limited share acquisitions and restrictions on foreign portfolio investment have constrained the growth of these markets. Relaxing or eliminating investment restrictions will promote foreign portfolio investments resulting in improved liquidity and efficiency. This will give African stock markets increased growth potential and enhance their role in economic growth.
|Item Type:||MPRA Paper|
|Original Title:||Investment Basics XLIV: Review of African stock markets|
|English Title:||Investment Basics XLIV: Review of African stock markets|
|Keywords:||market efficiency; African stock markets; liquidity|
|Subjects:||G - Financial Economics > G1 - General Financial Markets
G - Financial Economics > G1 - General Financial Markets > G11 - Portfolio Choice ; Investment Decisions
|Depositing User:||Dr C Mlambo|
|Date Deposited:||30. Nov 2012 14:58|
|Last Modified:||19. Feb 2013 13:43|
Bekaert G. and Harvey CR. 2001. Research summaries: economic growth and financial liberalisation in the NBER Reporter Spring 2001:8-11.
Business in Africa; International Magazine, June 2001.
Collins D. and Biekpe N. 2001. African financial markets: interdependence with and contagion from global emerging markets, Paper presented at the Development Studies Association Annual Conference, Institute for Development Policy and Management, University of Manchester, UK.
Erb CB, Harvey CR. and Viskanta TE. 1996. The risk and expected returns of African equity investment Chapter 5 in Collier P. and Pattillo C’s ‘Investment and Risk in Africa’, Macmillan 2000 Ed. P122-145.
Fish T. 2001. The construction of African regional and All-African Stock Market Indices’, MBA Dissertation, University of Stellenbosch, South Africa.
Kwakye-Agyekum A. 1999. Stock exchanges of Sub-Saharan Africa. Standard Equities Securities Research July 1999.
Levine R. 1996. Stock markets: a spur to economic growth, Finance and Development, March 1996:7-10.
Mate C. 2000. Capital markets, poverty reduction and economic growth – a challenge for Africa. Paper presented at the Annual African Investment Conference and Exhibition, 4 – 5 October 2000, University of Stellenbosch, South Africa
Pension Fund Indicators 2001; Chapter 5 p 38-43.
Senbet LW. 2000. Discussion on ‘The Risks and Expected Returns of African Equity Investment’ by Erb, Harvey and Viskanta, in Collier P. and Pattillo C’s ‘Investment and Risk in Africa’, Macmillan 2000 Ed. P146-150
Tyandela L and Biekpe N. 2001. Construction of All SADC Stock Markets Indices. The African Finance Journal, 3(1), 2001, South Africa.