Delegates at the just-concluded African Women Economic Summit (AWES) held in Lagos, and co-organised by the African Development Bank (AfDB) have proposed ways to end the financial exclusion of women in the continent.
Absence of relevant information on credit opportunities, lack of technical capacity on the part of both financial institutions and women entrepreneurs were identified as the primary reasons for poor access to credit by women.
Ms Kiendal Buritt of South Africa’s Summit Development Group, Africa, said that investing in banks and providing strategic support will greatly enhance banks’ ability to service small and medium-sized enterprises (SMEs).
‘’We support SME-centric banks and we provide the necessary technical support in assessing risks. We want to create a business model for the banks that help them adequately assess risk of SMEs,’’ she said. The support, she said, also includes helping women entrepreneurs build confidence and resilience.
Ms Patience Marime Ball, of the International Finance Corporation’s global financial department, said the IFC plans to invest in a million SMEs with about 25 percent of the funds going to women entrepreneurs. She said what is important is how to get private equity funds to deploy funds quickly, adding that the IFC has about $2.8 billion committed to private equity funds with about $1.5 billion going into SMEs.
She advised New Faces New Voices, the other organiser of the summit along with the AfDB, together with the IFC and private equity funds to create a network platform towards increasing funds for women entrepreneurs.
The AfDB’s principal investment officer, Aude Apetey, said her bank is at the forefront of promoting SMEs through its investment with SME-focused private equity funds. As a results-oriented institution, the AfDB regularly reviews the performance of private equity funds and financial institutions to which it makes loans, said Ms Apetey, adding that there is an effective feedback mechanism that helps the AfDB keep track of its activities.
However, Yetunde Allen, managing partner at Lateral Links, Nigeria, said that financial institutions are not out to help women but for their self-interest. She said only five percent of SMEs funding comes from the formal financial institutions in Nigeria.
Ms Yetunde emphasised that financial inclusion goes beyond allocating credit to women entrepreneurs but also entails insurance, leasing and other support services that enhance the activities of entrepreneurs. ‘’There is a missing business support system. We need to build a business support ecosystem,’’ she said.
Pan-African meet seeks to develop regulatory framework
More than 100 high level experts from across Africa will discuss ways and means to develop the derivatives and commodity exchanges in Africa, through the alignment of the African regulatory framework with global standards at a meeting takes place from July 25 to 27 July 2012 in Gaborone, Botswana.
The “Pan-African Workshop for Regulators of Derivatives and Commodity Exchanges”, will bring together in Gaborone, Botswana, representatives of ministries of finance and central banks, commodity exchanges, securities and capital markets authorities as well as representatives of multilateral organizations.
“The workshop will provide African regulators with strategic and technical information to assist in the development of robust and efficient regulatory frameworks that meet prevailing international standards,” said Moono Mupotola, AfDB’s manager in charge of regional integration and trade.
Considered as one of the most important causes of the global financial crisis that broke out in 2008, derivatives could enhance the liquidity, stability and robustness of financial systems, as long as they are structured and regulated in an appropriate manner. They are critically important risk management instruments for commodity chains, companies, banks, financial institutions and investors.
In that light, global regulatory reform recommends to trade derivative contracts through Exchanges and to clear derivative obligations through central counterparty clearinghouses (CCPs) by end 2012 at the latest.
Excepting South Africa, derivatives exchanges and CCPs do not yet exist in Africa. However, there has been growing realisation that efficient financial and commodity markets are a prerequisite for equitable, inclusive and sustainable development. This has been manifested in key policy documents, including the African Union’s Arusha Plan of Action and Declaration on African Commodities, 2005, as well as in the Final Communique from the COMESA-EAC-SADC Tripartite Summit of Heads of State and Government, 2008.
By taking a leadership role in the organisation of this event in cooperation with Bourse Africa Limited with the support of Botswana Investment and Trade Centre (BITC), the African Development Bank is playing its role as a catalytic agent at the heart of Africa’s capital and financial markets, incubating and disseminating best practices and innovative ideas across the continent. As such, AfDB seeks to help African countries and non-governmental actors understand the benefits that arise from exchanges and the development of paradigm-shifting structures and practices that can revolutionise African capital and commodity markets.
The AfDB expects to catalyze interest among stakeholders on the importance of exchanges for price discovery, market transparency, financing, hedging and risk management, infrastructure development, job creation and cross-border economic integration.