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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