2006 East African Stock Markets Roundup

NSE ends the year as the best performing capital market in East Africa. As the chart shows, the number one position was held by the Uganda Stock Exchange for the most part of the year. But a decline in Kampala’s fourth quarter activity sent it to the second position. The Dar Stock Exchange had a rough season. Its recovering index was negative all year long.

Year 2006 was on overall a remarkable season for East African capital markets. One can easily observe that: (1) more East Africans, especially in Kenya and Uganda, were ushered into stock market investing, (2) companies no longer shied away from raising capital at Nairobi, Dar or Kampala exchanges, and (3) governments started considering sale of parastatals through IPOs.

The year ends with a sweet note to East African investors and companies alike: the trio exchanges could soon merge into an East African Stock Exchange. NSE and USE have agreed on that arrangement, but DSE people are still “thinking.”

“It’s a relief that a company situated, say, along the Nile in Uganda can depend on capital provided by an investor in as far as Lamu in Kenya. However, an old Ujamaa Legacy means that our southern neighbors are being left out (see my comment at Odegle Nyang Investments).