Up to five companies are expected to list on Myanmar’s stock exchange when it opens in October, according to an official overseeing the creation of a market that will help develop an economy stifled by 49 years of military rule.
Due to open a month before the country holds a crucial general election, the Yangon Stock Exchange has suffered a series of delays and authorities are now scrambling to issue listing standards, underwriting, broking and consulting licenses to be ready in time.
“I’m not confident, but it might be alright,” said Shigeto Inami, managing director at the country’s only existing over-the-counter exchange, told Reuters last week.
Myanmar’s first stock exchange was closed in the 1960s after a military takeover.
Its successor is the Myanmar Securities Exchange Centre run by Inami. It is a modest over-the-counter operation with two listed companies, operating as a joint venture between state-owned Myanma Economic Bank and the research arm of Japan’s Daiwa Securities Group since 1996.
Daiwa and the Tokyo bourse signed an agreement in May 2012 with Myanmar’s new civilian government to help set up a stock exchange.
“When the government says something will happen by a certain date, it always does,” said Inami, who has spent the last 17 years in Myanmar, and is now heading the preparations for the opening of the fully-fledged exchange.
Foreign direct investment has grown 25-fold since reforms began under the nominally civilian government of President Thein Sein in 2011, reaching $8.1 billion last year, but the country’s financial institutions are still struggling to recover.
Inami expected a handful of companies to list once the exchange opens.
“Three to five would be reasonable at the time of the opening. We want to see about 10 listed by the end of 2016,” he said.
Daiwa officials say they want to replicate the success of Vietnam, where more than 600 companies have gone public since the opening of its first bourse in 2000.
They want avoid the fate of Cambodia and Laos, which have attracted only a handful of companies since their exchanges opened for business in 2011.
Brunei, a tiny oil-rich sultanate on the island of Borneo, has said this month it wanted to launch a stock exchange by 2017.
Myanmar Agribusiness Public Corporation – a company that invests in farming and agricultural projects and Asia Green Development Bank, a bank with 48 branches across the country, have expressed interest in being listed on the Yangon exchange.
First Myanmar Investment, headed by a prominent local investor Serge Pun, who runs another company listed in Singapore, is also aiming to go public when the exchange opens. (Reuters)
