Mohamed Omran, chairperson of the Financial Regulatory Authority (FRA) and former chairperson of the Egyptian Exchange (EGX), asserted – during the opening session for the 21st ASEA Annual and Flagship Conference – that Africa is an important place for Egypt to access.
“What we need is not only a high growth rate, but what matters more is the quality of growth that is inclusive and sustainable, a growth that is different than the current one where a handful of less than 10 men own the same wealth as half of the world population (or 3.7 billion people),” he said.
“No wonder that the role of stock exchanges was an integral part of this initiative,” he added, noting that they even started long before the sustainable development goals (SDG).
“The first five Streaming SIMD Extension (SSE) partner exchanges were BOVESPA, the EGX, Johannesburg Stock Exchange, Borsa Istanbul, and NASDAQ-OMX. As a regulator, we have a mandate: to ensure a sound and stable financial system that is able to mitigate or accommodate any financial vulnerability, to face regulatory challenges, and to address any relevant market failures through introducing relevant regulatory and policy reforms,” he said.
“We are also concerned about the speed of technology, in particular new issues like Cyber Resilience,” he stated.
In this regard, he confirmed that the Financial Stability Board (FSB), and the International Organisation of Securities Commissions (IOSCO), among others, issued guidelines on how to deal with such risks, expecting firms to demonstrate that they have put in place effective threat detection systems, robust communication plans, and have designed a solid governance structure.
“As far as the capital market and Egypt are concerned, it is worth mentioning that we advanced 55 positions in security market regulations in the latest competitiveness report and also 33 positions in the latest doing business report in minority investor protection,” he added.
“But is that enough? Of course not. We aggressively work on several other initiatives to further protect our investors,” he added.
“The day before, I chaired the oversight board meeting and we agreed to study a proposal that auditors of listed companies and brokerage firms should be insured to provide better coverage against any bad quality of audit reports,” he declared, stating that they are discussing the possibility of introducing a new protection scheme to compensate investors for non-commercial risk of listed companies.
Omran confirmed that African countries today are amazed at the degree of development that has taken place, in particular, the level of infrastructure and technology.
“If we glance through the latest infrastructure quality index, we see that Africa has experienced an infrastructure boom, rising from 3rd in 2012 to 13th in 2017. As far as the Financial Sector Development Index, unfortunately, the worst 20 countries in financial sector development are dominated by African ones, with ten spots,” he added, noting that Africa is made up of more than 54 nations, yet the number of stock exchanges is just 28 and a lower number of capital market authorities.
Finally, Omran addressed the ASEA members to promote economic development, asserting that ASEA has a crucial rule in achieving prosperity in Africa.
“We are waiting to see the benefit from what you are doing,” he added.