Local companies have been urged to list on the Rwanda Stock Exchange as one of the ways to raise money for expansion. Finance minister Amb. Claver Gatete noted that the stock market is a good avenue firms should consider to tap-into global resources.
“Recently, the government issued a Eurobond, which raised much more money than we had anticipated,” said Gatete.
“This shows that investors are always looking for where to put their money. So, entrepreneurs should use instruments like bonds to raise finance.”
Gatete was speaking during a breakfast meeting organised by the Private Sector Federation to find ways through which local firms could source funding.
There only two local firms listed on the stock market, Bralirwa and Bank of Kigali.
Kenyan firm Nation Media Group and Kenya Commercial Bank are cross-listed on the bourse.
Pradeep Paunrana, the ARM Cement managing director, while sharing his experience of listing on the Nairobi Stock Exchange in 1997, told the local chief executives that after listing on the stock market, ARM Cement’s viability improved.
“Besides this, we achieved our main objective which was to raise Ksh250m (Rwf1.91b).
“We were able to build a new plant and buy machinery to grow the firm’s capacity and increase profitability,” he revealed.
He observed that one of the ways to ensure that a company lives beyond its founders was to list it on the bourse.
Meanwhile, Hannington Namara, the Private Sector Federation (PSF) chief executive officer, has called on business people to work with the government and help it achieve the Economic Development and Poverty Reduction Strategy (EDPRS 2) goals.
“If the business community is organised, the government would be willing to give guarantees to help us raise investment funds,” Namara said.
This investment, according to Namara, would create over 200,000 off-farm jobs annually and promote industrialisation and export growth.
EDPRS 2 aims at having an annual economic growth rate of 11.5 per cent per year. Private sector investment is also expected to grow 25 per cent of the gross domestic product (GDP) from 10 per cent.
The New Times