Zambia’s Securities and Exchange Commission has officially launched the Cabinet approved Capital Markets Master Plan that is poised to grow the country’s financial sector over the next 10 years.
As part of extensive financial sector reforms aimed at enhancing the role of the financial sector towards bolstering the economy, the Philip Chitalu led commission has, with the help of the Zambian Government and various key sector stakeholders, delivered a 10-year plan which it believes is a comprehensive strategy for development.
According to the SEC Boss who spoke at the official launch that was held at Mulungushi Conference Center in Lusaka which, Zambia on 23 February 2023, the broad objectives of the plan include; the transformation of Zambia into a choice market for domestic issuers and investors, enabling the market to play a greater role in acting as a source of funds to the real sector of the economy, and enable a deeper development of liquid capital markets based on the strengthening of financial market infrastructure.
The master plant provides five (5) key developmental areas and building blocks. They believe that these building blocks will enable it to achieve the development agenda.
The first block in the master plan is the “Enhancing Government Bond Market”. This block will focus on enhancing participation of primary market issuance and transparency. It will also enable for the development of secondary market trade as well as secondary market post trade.
Block number two will focus on “Enhancing other traditional security markets”. Development of corporate bond markets will be the core of this block. It will also focus on enhancing on the local equity market. Investment collective schemes that have been very popular will also be developed and investment schemes of choice.
In the third block, the SEC will facilitate the “Development new and innovative products and markets”. They will seek to enhance the private equity, debt and venture capital markets which have lagged behind. Tracking and supporting of capital markets will also be facilitated through this block. The SEC will aspire to enable the development of ETFs, REITs and retail bonds. This will also be extended to onboarding of in vouge green bonds and their development.
The success of this master plan will be underpinned by capacity building. Through the “Enhancing Capacity Building across the Capital Markets” fourth block, the SEC will see to the enhancement of skills development. They will encourage investor education that has suffered from information asymmetry over the years. This will be underpinned by development of sustainable funding models across the capital markets.
The final fifth block will focus on “Enhancing the Capital Market Regulatory Environment”. As a regulator, the SEC will ensure it enhances regulation to improve oversight. They hope that through the enshrinement of investor protection in investor practices, they will develop a sound investment environment that has proper reporting guidelines.
