Popoola: Next Frontier for Africa’s Capital Markets Is Capital From Within
The Managing Director and CEO, NGX Group plc, Mr. Temi Popoola, has said he sees an opportunity to connect Africa’s pools of capital more effectively with businesses across the continent,
Temi Popoola, Managing Director and CEO of NGX Group plc, believes Africa's capital markets have the potential to become a major source of funding for businesses on the continent. He argues that Africa's next big opportunity in the capital markets may not be attracting more foreign investment, but rather better utilizing the capital already within the continent.
Many African investors, including pension funds, asset managers, and financial institutions, hold significant amounts of savings that could be better directed towards African businesses. However, the current structure of African capital markets is largely fragmented, with each country operating its own distinct market. This can make it difficult for investors and businesses to access capital across borders.
Popoola envisions a more interconnected African capital market, one where capital can flow more freely across national borders. He points to initiatives like the African Exchanges Linkage Project (AELP), which aims to improve securities access across participating African markets. NGX Group, one of the exchanges involved in AELP, is building the necessary infrastructure to make this vision a reality.
Through NGX Invest, the company is expanding channels for investors to participate in public offerings, making investment opportunities more accessible through various financial institutions. Popoola emphasizes that building this interconnected market requires cooperation across various aspects of the financial ecosystem, including regulation, brokerage, custody, settlement, market information, and investor protection.
Nigeria serves as a prime example of the potential for this type of integration. As domestic institutional assets and investor participation grow, the question is no longer just how to finance Nigerian enterprises, but how to enable African capital to participate more efficiently in opportunities across the continent. The Dangote Petroleum Refinery and Petrochemicals public offer, launched on the Nigerian Exchange, is a notable example of a major African business successfully tapping into the capital market for long-term financing.
Popoola argues that the objective is not merely to facilitate individual transactions, but to build a market capable of connecting African enterprises with broader pools of capital. This shift has the potential to benefit a variety of sectors in Africa, including infrastructure, energy, manufacturing, technology, agriculture, and financial services.
By increasing participation from African investors and businesses in each other's markets, the continent could see more robust growth and development.
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