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Tuesday, 26 November, 2002, 17:52 GMT
Africa's share trading ambitions
Cyrille Nkontchou using Liquid Africa site
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Buying shares online has fallen out of fashion. And buying African shares has never been in fashion. But now one man is trying to change all that.
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"We want to at least get Africa onto the radar screen of investors," said Cyrille Nkontchou, founder of the first pan-African, online trading platform.

The 35-year old entrepreneur from Cameroon gave up his senior research job at Merrill Lynch in order to develop his Liquid Africa masterplan.


Our philosophy is that, coming from a base of almost zero, it's very easy to grow

Cyrille Nkontchou
The idea is to win sub-Saharan Africa its fair share of trade by providing more stock market information, developing a network of brokers across Africa and providing access to online trading.

"It's a bit of an uphill battle but we're fairly confident that, over time, we will substantially increase interest in African markets," Mr Nkontchou said.

"I think investors will take a fresh look at these markets if we can demonstrate that you can get consistent returns from a reasonable level of risk."

Small beginnings

Sub-Saharan Africa's 18 active stock markets - excluding South Africa and Nigeria - are fragmented, erratic and have very low trading volumes.

Cyrille Nkontchou
Cyrille Nkontchou thinks African markets deserve better
Nevertheless, Mr Nkontchou believes more funds should be channelled in their direction.

If fund managers distributed money in line with the value of listed companies, sub-Saharan Africa minus south Africa should attract about 1% of money set aside for the so-called EMEA region (Europe, Middle East and Africa).

But it only gets a tiny fraction of that money.

"Our philosophy is that, coming from a base of almost zero, it's very easy to grow," he said.

The best of times, the worst of times

Mr Nkontchou is not deterred by the wider gloom surrounding stock market investments.

The Liquid Africa website
Can the power of the internet transform Africa's stock markets?
On the contrary, he thinks the slump will encourage diversification and shed a better light on recent returns from African markets.

Nor is he worried by the limited success online trading platforms have had in Western markets.

It is the fragmented and little visible markets who can gain most from harnessing the power of the cost-effective internet, he explained, not the well-established markets.

Financial infrastructure

And, through a private equity fund, the Liquid Africa platform has attracted the backing of some of the US' biggest firms, including Microsoft and Citigroup.

Now Mr Nkontchou is taking a roadshow to international fund managers, persuading them to invest in Africa.

"We're fairly confident that we really have a strong business case."

"If our venture fails it means even more pain for Africa's capital markets."

"The development of capital markets is as important in terms of infrastructure as building a road or an airport," he said.

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 ON THIS STORY
Cyrille Nkontchou, Liquid Africa
"Liquid Africa's vision is to make investing in African stock markets easy."
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