The NasdaqOMX Group has been selected to provide the technology
for the new East Africa Exchange (EAX), which is due to rollout in Q3 2013, and
has been actively pitching for business today at the World Economic Forum’s
Davos meeting in Switzerland.
President Paul Kagame of Rwanda, and stakeholders Nicolas
Berggruen of Berggruen Holdings and Wiebe Boer of Heirs Holdings, plus Jendayi
Frazer of 50 Ventures, all presented the plans for the new East Africa Exchange
today at 4:30pm at a Davos press conference. The other stakeholder in the
private initiative, Ngali Holdings, was not present.
Nicolas Berggruen, the founder and president of Berggruen
Holdings, said that: "A transparent, modern exchange will make investment
much more likely. Agriculture is key to Africa's prosperity, and so aiding the
flow of information and finance within the agricultural sector will be
especially helpful."
NasdaqOMX will deliver its widely deployed X-stream technology
solution to power the trading and clearing activities for equities and derivatives
– particularly farming and commodities derivatives – on the nascent exchange,
which is based in Kigali, Rwanda. It was selected ahead of a number of other
global exchange technology providers in a competitive tendering process.
Through private sector led investment and under the terms of an
agreement signed with the government of Rwanda, the East Africa Exchange aims
to increase regional market efficiency and liquidity, as well as giving the
region's population of 130 million people, especially smallholder farmers in
the area, better access to international markets. The exchange will initially
focus on establishing an auction facility and spot trading for agriculture and
non-agriculture commodities, but will also develop futures trading across the
East Africa Community region.
Commenting on the contract win, Lars Ottersgård, senior vice
president and head of market technology at NasdaqOMX, said: "This is a
significant honour for us to be chosen to help launch a new exchange in Africa.
As the East Africa Exchange grows and expands its vision for greater market
efficiency, liquidity and transparency, we are dedicated to supporting its
efforts through our proven trading and clearing technology."
NasdaqOMX's X-stream trading technology is currently used by over
25 exchanges globally. Just last week, NasdaqOMX announced plans to build a technology powerhouse as part of the
company’s plans to decrease its reliance on declining trading volumes for its
profits. The East Africa Exchange technology provision is just one small part
of its plans.
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