Only 2% of Ghanaians invest in securities – GSE MD
A paltry 2% of the over 30million Ghanaian population invest in capital markets, the Ghana Stock Exchange (GSE) has disclosed.
According to the Managing Director of the GSE, Ekow Afedzie, this situation is worrying, as securities investment is not only the future of the country but such a situation also stifles economic development.
Speaking at an investment forum in Accra on Thursday, July 22, 2021, Mr Afedzie, said, “the investment base in Ghana is very low; it’s below 2%. In other words, we have below 2% of our people investing in security.
“If you go to the Central Securities Depository (CSD), we do not have more than a million accounts, and about 80% of those accounts have holding debts, that is treasury bills, with just about 200 thousand holding equities,” he bemoaned.
He noted that there was the need to quickly move from the current 2% to about 10% to contribute significantly to the development of the economy.
On the part of the GSE, the MD said several measures through its capital market plan, has been taken to boost investor knowledge and confidence and make investment more convenient to the Ghanaian through technology.
The GSE has since started engagement with financial technology (fintech) companies on how to reach the populace with new products onto its listing, and general investments.
“We have been talking to many companies from the fintech market, ICT, and insurance, as well as the banking sector in this regard. One other thing that falls under the capital market plan is how to increase the investment base,” he said.
Mr Afedzie added that GSE would also improve the infrastructure of the market, and to this end have been collaborating with fintech companies to develop convenient solutions to the investing public.
“We want to take the exchange to the doorstep of the investor so that the investor can just pick up the mobile phone and be able to invest through its broker at any time, and access market information.”
Furthermore, the GSE would intensify public education and sensitisation due to its belief that “without investment, there is no future.”
He also called for the support of industry players.
“We can only achieve this when we have the collaboration of all of you: regulators, pension funds, asset managers, licence due members, among others.
All these efforts are geared towards moving the GSE from a frontier market into an emerging market and becoming the preferred platform for investment and capitalisation to support national economic development.
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Venturing into the green bonds market
Meanwhile, the GSE has partnered with the International Finance Corporation (IFC) to explore other investment areas, particularly, green bonds.
The agreement would see IFC support the country to develop guidelines that would give investors opportunities to finance green buildings, clean transportation, and renewable energy.
Other areas for this new investment are sustainable water management and other climate-friendly projects.
This is to support Ghana’s transition to a lower-carbon future, as specified in the country’s agreed contributions under the Paris Agreement.
“This partnership will enable the SEC to tap into IFC’s deep knowledge and develop a comprehensive reference guide appropriate for the Ghanaian market,” said Daniel Ogbarmey Tetteh, Director-General of Ghana’s SEC.
On his part, the IFC Country Manager for Ghana, Ronke Ogunsulire, said, “finding new avenues for green financing is a key priority for IFC.
Our partnership with the SEC to design the framework for green bonds in Ghana will, in turn, help Ghana achieve its climate goals with projects that create jobs and spur economic growth.”