Nairobi Securities Exchange and the UK government's investment support arm have partnered to facilitate sustainable development in Kenya.
The NSE will work with the Mobilising Institutional Capital Through Listed Product Structures (MOBILIST).
The two are keen on mobilising private sector capital towards public projects that are in line with the United Nations’ Sustainable Development Goals (SDGs).
Key players in the Kenyan financial industry, regulators, investors, and current and prospective issuers met on Tuesday in Nairobi, when the deal was announced.
MOBILIST provides investment capital, technical assistance and support to enable SDG-focused projects to overcome the key barriers that prevent them from listing on a stock exchange.
By expanding listed instruments that institutional investors can use to invest in emerging markets such as Kenya, MOBILIST intends to unlock new sources of capital to fund sustainable growth and development.
John Humphrey, His Majesty’s Trade Commissioner for Africa, said that mobilising investment solutions in Kenya is vital for economic growth.
"They provide a platform for Kenyan businesses to raise the capital they need to expand their operations, increase cross-border trade and employ more Kenyans, at the same tackle climate change and achieve critical development goals,"Humphrey who was in Kenya on a three-day visit said.
According to the African Development Bank’s economic outlook for 2024, the continent needs to invest at least $402 billion (Sh51.8 trillion), if it aims to catch up with high-performing developing countries by 2030.
This, as they prioritise spending on key SDGs like education, energy, productivity, and infrastructure.
A recent research commissioned by MOBILIST and Revego Fund Managers highlighted that, on its own, sub-Saharan Africa’s renewable energy market already represents a potential investment opportunity of $193 billion (Sh24.9 trillion) by 2031.
In Kenya, achieving the structural economic transformation that investment in renewable energy and other key sectors could stimulate will require additional investment of $12 billion (Sh1.5 trillion) annually.
The AfDB has emphasised that these investment levels cannot be met without increased private-sector participation.
“The strategic partnership aligns with our new strategic focus aimed at enabling the NSE to play a more dynamic role in mobilising and channelling capital to sectors that have the most significant capital needs, with a special focus on sustainable development," NSE chief executive Frank Mwiti said.
He said as a market, NSE will continue providing a pivotal intersection connecting capital to investment-grade opportunities in Kenya for sustained economic growth.
Ross Ferguson, who leads the MOBILIST programme at the UK Foreign Commonwealth and Development Office, noted that markets in Kenya and other African economies hold untapped potential to mobilise private capital needed to gain ground in addressing the SDGs, and the severe impact of climate change.
"MOBILIST is proud to partner with the NSE in building a local capital market that can give the African firms working on these challenges access to the capital they need to grow,” Ferguson said.
MOBILIST seeks to partner with financial institutions at the core of capital markets and will engage with and accept proposals from NSE’s network of brokers, investment banks and promoters of public offerings.
While MOBILIST can only deploy equity capital, the programme can provide debt securities issuers with technical assistance funding.
