The Johannesburg Stock Exchange (JSE) and the Nigerian Stock Exchange (NSE) are working to develop a strategic partnership to benefit investors and create opportunities for cross listing on both exchanges.
The exchanges are confident that they can complement each other in such a collaboration and, ultimately, contribute to further strengthening of economies across Africa.
The Johannesburg Stock Exchange (JSE) is the 19th largest exchange in the world, by market capitalization, and the largest in Africa. The JSE offers secure, efficient primary and secondary capital markets across a diverse range of instruments, supported by cost-effective services.
Speaking at a visit to Lagos recently, the JSE’s Director of Capital Markets, Donna Oosthuyse, noted that the collaboration of the exchanges will help grow the Nigerian capital market and improve the NSE’s liquidity.
“We are of the view that everyone would benefit from this. We have been working with the NSE for some time, in this regard, and the joint goal we have is to develop products and services that would be of interests to issuers and investors in both markets. This would be of mutual benefit. So we would like to have South African companies and products listed on the NSE; and we would also invite Nigerian issuers and products to be listed on the Johannesburg Stock Exchange (JSE),” Oosthuyse said.
The JSE’s Donna Oosthuyse is optimistic that the ability of companies in both countries to cross list on the exchanges will benefit investors and grow the continent’s capital markets.
“I have spoken to a lot of private wealth managers that aspire and want to be exposed to the Nigerian economy because they see higher growth than in many other markets and they believe there is opportunity for greater returns and they are willing to take the risk. So we see cross listings not just from Nigeria to South Africa but also from South Africa to Nigeria. We have got MTN already listed on the NSE while we have got Oando listed on ours. We would like to see more of this,” said Donna Oosthuyse.
The JSE is also seeking collaboration with the NSE on exchange-traded products like exchange-traded notes (ETNs) and exchange-traded funds (ETFs), particularly securities based in one exchange that would reference products on the other exchange. Donna Oosthuyse noted that the JSE is already in discussions with Nigerian issuers, investors, and stockbrokers on how such inter-exchange products could be developed.
“We trade not just on equities and equity derivatives, we have the third largest bond market in the world. We have bonds, interest rate, currency, and commodity derivatives,” said Oosthuyse.
“We would welcome members from NSE coming over to spend time at the JSE and hope that our members would also be welcome here so that we can learn from each other. From our interactions, I think the industry professionals in the NSE and in the ecosystem around investment are very good. Nigeria has almost the same challenge South Africa has, which is how to transfer expertise into educating the issuers and investors, in terms of what value the exchange brings to the economy,” Oosthuyse added.
The Johannesburg Stock Exchange (JSE) was formed in 1887 during the first South African gold rush. As South Africa’s only full-service securities exchange, the JSE connects buyers and sellers in a variety of different financial markets, namely equities, equity derivatives, commodity derivatives, and interest rate instruments. The JSE has 62 equities members, 120 equity derivatives members, 92 commodity derivatives members, and 102 interest rate and currency derivatives members licensed in South Africa. The JSE has a mix of local and international operations.