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Libyan stock exchange opens to foreign investors

Global Arab Network - Oxford Business Group

Tuesday, 05 January 2010 00:00

The opening up of Libya’s stock exchange to foreign investors marks the beginning of an era which will bring rapid developments in the country’s capital markets, according to the Chairman of Economic Group Libya (MAL), Khalil ElKwafi.

Since Decree no. 14 came into force in June, allowing non-resident investors to buy shares in the Libyan Stock Exchange (LSE), four sectors have been listed and ElKwafi voiced his confidence that heightened activity was on the horizon.

“More IPOs are expected to take place, such as Libyana and Al Madar for the telecommunications sector, National Commercial Bank NCB for the financial sector and Libyan Steel for the industry sector, which should boost the capital markets’ developments,” he said.

ElKwafi added that the introduction of mutual funds and related activities, which were anticipated for the coming year, would certainly help the LSE in its expansion bid. “Private equity, venture capital and development funds should be increased and adopted since they act as incentives and provide private listed companies with the best opportunities to benefit from the Libyan economy,” he said. “Together, the IPOs and additional activities will certainly contribute to the diversification of the LSE.”

Decree no. 14 has made it possible for non resident investors to own up to 5% of a listed company. Non resident investors are not permitted to take their money out of the country from a sale of shares for at least one month after the transaction takes place though and then only with the appropriate approval from the financial authorities.

ElKwafi said he was confident that as the LSE diversifies, Libya’s stock market will earn a higher profile among institutional investors. “This development will lead us towards better transparency procedures and governance practices that will elevate the LSE to international standards,” he said.

MAL, which is a registered member of the Libyan Stock Market, will be teaming up with Oxford Business Group, the global publishing, research and consultancy firm, for the Group’s forthcoming business guide, The Report: Libya 2010. The partnership was signed recently in Tripoli between ElKwafi and Jana Treeck, OBG’s Country Director in Libya.

Treeck said she was confident that the collaboration with MAL would add a new dimension to the Group’s report, ensuring that it reflected the rapid economic transformation taking place in Libya.

“As the first and only comprehensive guide to the Libyan economy, OBG’s annual economic review on the country was a ground-breaking success,” she said. “We are confident that MAL’s expertise will prove invaluable in helping OBG build on its past achievements and take The Report: Libya 2010 to a new level.”

Treeck said that the forthcoming report would include an extended chapter on capital markets and a share analysis provided by MAL. The report will also feature an exclusive interview with the Chairman of the Libyan Stock Market, Suliman Salem Alshahomy. “These exciting features will undoubtedly act as vital tools for key players in the global business community who are observing the business activity in Libya with great interest,” she said.

ElKwafi said he believed The Report: Libya 2010 would play a crucial role in helping to raise awareness of the country’s investment opportunities among the international business community which he said was key to future success.
“Foreign investors should be seen as an important element for the future of the capital markets in Libya,” he said. “Their input will boost the number of transactions and volumes within the LSE and it is through their activity that the stock market will attract interest from institutional investors.”

ElKwafi said it was therefore vital that players on the global business scene had accurate, credible data at their fingertips which they could use to make their investment decisions. “I am delighted that MAL is making a significant contribution to OBG’s report which will prove invaluable to readers as a means of measuring the risk and returns of their potential investments,” he said.

The Report: Libya 2010 will serve to re-enforce OBG’s place as the world market leader in providing accurate, insightful economic information on developing and emerging economies across the continents. Rated as the premier source of information for foreign direct investment into Libya’s economy, the highly-anticipated report will be a vital guide to the many facets of the country, including its macroeconomics, infrastructure, political landscape, banking and sectoral developments. The report will be available in print form or online.

Global Arab Network

Image courtesy of flicker by Sammy_Naas

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