This week Htet Tayza discusses Myanmar’s plans to open a stock exchange in its capital city.
Myanmar has been gradually moving away from a centrally planned economy during the past half-decade. This has revitalised the South-Asian nation’s economic fortunes; according to the Asian Development Bank, Myanmar’s economy expanded 7% last year and is expect to grow 8.3% in 2015.
The nation’s impressive growth has been spurred by foreign investment. Myanmar’s deputy finance minister Maung Maung Thein recently stated that the country saw foreign direct investment increase $8 billion in the fiscal year to March 2015.
Maung Maung also noted that government data suggests foreign direct investment in Myanmar is $3 billion more than expected. The Wall Street Journal reported that the minister revealed these figures when he announced that Myanmar is planning to open itself up further to foreign investors by establishing a stock exchange in Yangon.
In an interview with The Wall Street Journal, the minister said that “we expect to launch (the Yangon Stock Exchange) in the first or second week of December.” The original plan was to establish the exchange in November, but it was delayed due to Myanmar’s general election on 8th November 2015.
Myanmar’s government will announce a list of roughly ten firms that will be listed, as well as their scheduled initial public offering dates when the exchange is launched. They’re currently in the process of assessing around 300 firms, and experts believe that those chosen are likely to come from Myanmar’s agriculture, transportation and power generation industries.
Yangon is also re-writing legislation which is designed to ensure that foreigners don’t own stocks in some firms. Mr. Maung Maung Thein said that the bill is expected to be passed by Parliament “in the early part of next year.” Therefore foreign investors should be able to trade Myanmar stocks “a few months” after the opening of the exchange.
Htet Tayza comments
Myanmar’s economy has benefited significantly from the influx of foreign investment it has received in the past few years. The establishment of the Yangon Stock Exchange in early December 2015 could encourage foreign investors further, and lift the nation’s economy to new heights.