World Economic Forum on Africa urges better policy for financial market resilience

Africa needs better and more flexible policies to build financial market resilience in the face of global economic volatility, economists urged at the ongoing World Economic Forum (WEF) on Africa 2016 in Kigali, Rwanda.

They were speaking at a panel discussion titled "Building Financial Market Resilience".

Pravin Gordhan, South African Minister of Finance, said that Africa needs to work on creating better and sustainable policies that favour the resilience of financial markets.

"The continent's dependence on foreign lenders in form of loans is serious! Africa should keep the foreign-denominated debt at minimum as possible, because too much foreign debt will weaken African financial markets," he noted.

According to the economists, Africa's financial sector is considered to be one of the most promising sectors in the economic sphere.

"Greater financial government policies will allow the continent to tap into the vast potential of its domestic resources to finance its huge infrastructure and energy deficits," said Hendrick du Toit, Chief Executive of Investec Asset Management Limited, a South African financial services company.

He noted that some African policy makers are in denial about currency flexibility.

Benno Ndulu, governor of the Bank of Tanzania said that diversity in financial development across the African continent is illustrated in a high concentration of the largest banks in just a few countries.

"Investors in Africa need to become far more aware of the policies of the countries they're putting money into in order to build resilience into the countries financial markets," he advised.

The panel discussion focused on deliberating ways to improve financial diversity and build resilience into financial markets, which are key to strengthening financial stability in Africa.

The three-day World Economic Forum on Africa 2016 which kicked off on Wednesday has brought together more than 1500 delegates from Africa and beyond.

The theme of the forum is 'Connecting Africa's Resources through Digital Transformation.'

(APD)