Myanmar yesterday officially launched its first modern stock exchange, but without a single stock to trade until next year, as the nation’s latest drive for economic revitalization struggles to take flight.
Aung San Suu Kyi’s National League for Democracy (NLD) swept elections last month, boosting confidence in the former junta-run nation’s reforms, which have also creaked open the door to its reclusive economy.
The bourse yesterday opened with the clanging of a large ceremonial bell, marking an ambitious new stage in the nation’s efforts to ignite investment.
Photo: AP
“We have a dream and this morning this dream has come true,” said Maung Maung Thein, head of Myanmar’s Securities and Exchange Commission, in an opening speech at the newly restored colonial-era building housing the Yangon Stock Exchange.
He said six local firms had been approved to list on a market tipped to be “instrumental to the growth of our economy.”
Those companies, which include the Japan-backed Thilawa Special Economic Zone and First Myanmar Investment run by Burmese tycoon Serge Pun, “will be going into the annals of our history”, he added.
However, they will have to wait until February or March to begin trading, after delays in confirming underwriters pushed back the time frame for initial public offerings.
The lack of active trading did not stop officials from proudly screening a mock-up of the stock exchange for guests.
Burmese Vice President Nyan Tun, who rang the bell, told reporters that while the stock market would start out with only local firms, authorities hope it will become a regional player.
However, analysts say the country has a long way to go to build trust in its new market.
Mixo Das, of Nomura in Singapore, said that the bourse would need to build a track record of good governance, trading history and market liquidity.
“I think the stock exchange in Myanmar will be much like the ones in Laos or Cambodia — more as a source of national pride and learning experience for the first several years,” he added.
Rajiv Biswas, of IHS Global Insight, said the bourse will be an important tool in developing the country’s financial system, with the listing of larger banks and corporations promising to help the creation of equity and pension funds.
It could also help a new government, run by Aung Sang Suu Kyi and the NLD, tackle hulking state-owned enterprises, enabling capital raising for partial privatizations, he said.
Myanmar’s bourse has been decades in the making.
In 1996 Japanese firm Daiwa Securities and a state bank set up the Myanmar Securities Exchange Centre, but this allowed over-the-counter sales of shares in just two firms, a local timber company and bank.
Official media has said state-owned Myanma Economic Bank will own a controlling 51 percent stake in the exchange, with the remainder divided between Japanese partners the Japan Exchange Group and Daiwa Institute of Research, the research arm of Daiwa Securities Group.
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