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Investors urged to be patient as stock exchange opening confirmed
The opening of the first ever Lao stock market will take place on schedule later this year, but trading is not expected to begin until early 2011.
General Secretary of the Securities and Exchange Commission Office, Mr Dethphouvang Moularat, denied rumours that the opening would be delayed and confirmed that the October 10 date would still stand.
But he conceded that it would take time before the market was fully operational.
“After the official opening, we might need some time to ensure everything is exactly ready, and investors can expect to be able to trade shares by early 2011.”
However, Mr Dethphouvang said stockbroking companies still had to be established to register securities before the stock market officially opens.
So far, two financial securities companies have emerged – one of which was formed between Banque pour le Commerce Exterieur Lao (BCEL) and Thai company KT Zmico, and another between Kolao Group and Daishin Security Company of Korea.
BCEL Managing Director, Mr Sonexay Sitphaxay, said the newly formed company is expected to be operational at the end of September, before the official opening of the stock market.
But according to the Securities and Exchange Commission Office, the initial market will need about four financial security firms to meet anticipated demand from Korea, Thailand, Vietnam and China.
These companies will provide consulting services for investors who want to buy or sell shares, benefiting from a small fee for each transaction.
The Lao economy has recently been experiencing rapid growth, fuelling demand for investment funding and business expansion. But the supply of funds has been limited because Laos lacks a stock exchange as a source of long-term funding.
The stock exchange is consequently expected to boost the economy and increase domestic production levels.
Work on developing the stock exchange began in 2007, and is a collaborative effort between the Lao government and a Korean company.
Vientiane Times
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