Rwanda Stock Exchange remains steady despite COVID-19 pandemic

Despite the global uncertainties caused by the COVID-19 pandemic, the Rwanda Stock Exchange has managed to maintain a steady course with secondary market activities increasing and the All Share Index rising by 10.75 per cent. Pierre Celestin Rwabukumba, the CEO of Rwanda Stock Exchange, discussed the resilience of the market and the future plans in an exclusive interview with CNBC Africa. Rwabukumba highlighted the stability of the market, attributing it to the level of the government and overall market stability in Rwanda. He mentioned that despite slight increases in volumes, price stability has remained consistent. Rwabukumba emphasized that the domestic counters have remained stable, with only a 1.4 index drop, which is negligible compared to the volatility seen in other markets in the region. The current market cap has increased by about 10%, influenced by an upward trend in some of the counters, which have positively impacted the main index. He also discussed the ongoing automation project of the Rwanda Stock Exchange, noting that the market is working towards full automation in collaboration with regional counterparts in the African community. The target set for the completion of the automation project is June this year, pending external factors such as lockdown durations. Rwabukumba touched upon the bond market in Rwanda, stating that while the bond issuance is ongoing, initial indications point to a reducing yield, signaling positive interest from investors. He underlined the importance of small and medium enterprises (SMEs) listing on the Rwanda Stock Exchange to access capital and stabilize their businesses during challenging times. Rwabukumba encouraged SMEs to focus on becoming investor-ready, even if they are not immediately ready for listing. In terms of investor behavior, Rwabukumba suggested that investors might lean towards safe havens such as government-issued bonds in times of uncertainty. He also mentioned the potential for investments in defense and pharmaceutical sectors, depending on market conditions. Looking ahead, Rwabukumba shared that while the COVID-19 pandemic has caused some adjustments to the original plans for 2020, the Rwanda Stock Exchange remains committed to its objectives. The exchange has adapted to the current situation by limiting physical contacts and conducting most operations online to ensure continuity. Rwabukumba emphasized the importance of monitoring global events and health organization guidelines to navigate the evolving landscape of the market effectively.