The growing number of investors from around the world who are eager to gain exposure to Africa has increased interest in SA-listed companies operating on the rest of the continent.

As an exchange we are well aware of the huge potential that exists in Africa, as do JSE-listed companies who are expanding their operations to take advantage of the incredible opportunities.

The attraction of resources and the undeniable growing middle class make it understandable why both local and foreign companies want to benefit. If you look at the largest companies listed on the JSE you’ll see that they’ve all grown to their current size due to global expansion – including expansion on the African continent.

These expansion plans offer our investors diversification and access to the African growth story, and makes the JSE well positioned as the investment bridge to access this.

The increased focus on African investment possibilities also creates opportunities for the dual listing of multinationals, with the secondary listing of Glencore Xstrata in late 2013 providing an excellent example, indicating a deliberate decision to expand into Africa using the JSE as the platform. In line with dual listings, as a bourse we seek to partner with other African exchanges and propose a dual-issuance model.

This means listing equity or debt on both the JSE as well as the local market – allowing African issuers access to the deep capital pools that SA offers while benefiting from local market participation and international investment into the domestic market. We continue to seek dual listings, particularly in quasi-equity instruments such as depository receipts and exchange traded funds.

The JSE further offers African governments and corporates a venue to raise capital for infrastructure development in these emerging economies with both government and corporate bonds – used by foreign and local issuers to raise capital to expand corporate operations. This further drives foreign direct investment into Africa.

Another benefit is the increased relaxation of foreign-exchange restrictions for foreign companies listed on the JSE, which allows foreign-domiciled corporates to be treated as domestic listings.

Africa’s investment allure continues to shine, with SA still the continent’s most attractive investment destination (closely followed by Nigeria). We at the JSE continue to be an accessible bridge for both local and foreign companies, while offering retail investors the opportunity to take advantage of this growth through their participation by investing on the exchange.

Zeona Jacobs
Director: Issuer and Investor Relations, JSE

April 2014
Image: Matina Steyn