SEC gives capital market fresh boost

The Securities and Exchange Commission (SEC) has launched an ambitious five-year strategic plan to substantially deepen and expand the nation’s capital market. This forms part of the 10-year capital market master plan (CMMP).

Unveilled at the 2023 Ghana Capital Market Conference commemorating the regulator’s 25th anniversary, the comprehensive blueprint lays out 60 initiatives to catalyse transformation of the space.

“We have completed our five-year strategic plan with the financial support of FSD Africa/FCDO. This plan, with its five goals and 60 initiatives, will drive our vision to become a top-tier African securities regulator,” SEC Director-General Daniel Ogbamey-Tetteh said in his keynote address.

The strategy focuses squarely on engendering greater depth and diversity within Ghana’s capital market landscape, while bolstering resilience to external shocks.

“Today’s rapidly shifting financial terrain brings unique trials. Our markets must innovate, develop more versatile investment products and, ultimately, prove more robust in the face of adversity,” SEC’s chief explained.

Pivotal to this agenda is augmenting institutional capacity, embracing next-generation technology and incorporating sustainable finance principles.

“We are adopting cutting-edge RegTech and SupTech solutions to support financial innovation while safeguarding market integrity, and we recognise the critical role sustainability now plays in shaping the capital market’s future,” Ogbamey-Tetteh added.

The SEC’s emphasis on sustainability aligns with intensifying global urgency around ethical, accountable investment practices. As the Director-General puts it: “By collaborating with other regulators to incorporate ESG standards across Ghana’s financial ecosystem, we aim to cultivate an environment wherein such values flourish.

“From large-scale educational campaigns to grassroots programmes, we strive at empowering all Ghanaians to fully leverage our capital market,” Ogbamey-Tetteh explained.

Mr. Ogbamey-Tetteh concluded by spotlighting the regulator’s considerable achievements over 25 years of nurturing Ghana’s securities ecosystem – including over GH¢30billion raised for business growth and robust expansion within asset management.

“Despite recent strains on investor confidence, our markets continue gaining force,” said Ogbamey-Tetteh, adding: “With indices recovering, funds under management rising and game-changing innovations in the works, the stage is set for our Strategic Plan to unlock immense possibilities.”

Integral partner in economic growth

Also speaking at the conference, finance minister Ken Ofori-Atta praised the SEC’s pivotal role in empowering broad-based prosperity through capital allocation – stating that a transparent, well-regulated financial sector is indispensable for economic expansion, job creation and citizens’ overall welfare.

Despite acknowledging how serious the recent economic constraints have been, Mr. Ofori-Atta voiced optimism regarding the economy’s growth trajectory.

“Our macroeconomic indicators point to a new beginning – with rebounding growth, exchange rate stability restoring confidence, and declining interest rates,” he noted.

The finance minister, himself a pioneer of the nation’s capital market, also spotlighted policy objectives within the 2023 national budget which establish fertile conditions for markets to thrive.

“We are intentional about safeguarding recent progress, expanding real-sector investments, completing infrastructural projects and mobilising climate financing to build resilient, sustainable growth,” he explained.

Despite the market’s relative growth, the minister highlighted significant untapped opportunities for further expansion. The most advanced capital markets boast a capitalisation exceeding 100 percent of gross domestic product (GDP), with some reaching as high as 200 percent.  The Ghana Stock Exchange’s market cap, at approximately GH¢70billion, represents only about 7 percent of the nation’s GDP.

Capital markets to power infrastructure, sustainability

Considering the securities industry’s unique capacity to finance national priorities, Mr. Ofori-Atta emphasied capital market instruments that channel investment into urban development, housing and environmentally responsible initiatives.

“Real Estate Investment Trusts (REITs) can massively boost infrastructure and housing project funding,” he noted, citing innovative vehicles like green bonds that direct capital into sustainable objectives.

“The SEC’s efforts here will prove integral as we strive to uplift millions through resilient, climate-conscious growth,” he stated.

“Ultimately, fulfilling the SEC’s broad mandate with adaptability and vision can profoundly impact Ghana’s long-term prosperity,” he said. “By rising to today’s tests, Ghana’s capital markets can help power us through an economically, socially and environmentally pivotal period in our history.”

By promoting coordinated efforts, financial inclusion, transparency and sustainable development, the finance minister said the SEC strategic plan’s success holds revolutionary implications for Ghana’s stability and global leadership.

“The time is now to cement the nation’s securities ecosystem as an engine of equitable progress and widespread opportunity. The tasks ahead are demanding, yet through diligence, determination and true public-private partnership, I’m confident we can realise our grand ambitions and help citizens nationwide feel genuine, grounded hope regarding Ghana’s future,” he concluded.