YANGON • After a delay of more than 20 years, Myanmar's stock exchange yesterday opened for its first day of business, with the trading of a single company.
First Myanmar Investment, a conglomerate controlled by businessman Serge Pun, made its stock debut in Yangon, ending a long wait caused by the Asian financial crisis, a wary military government and an underdeveloped financial system.
"For 50 years there has not been a stock exchange; today is a historic day," said Mr Pun, just before he rang the trading bell at 11am inside a renovated colonial building that once housed the central bank.
The move comes as the country's development accelerates with a democratic government being formed after an election victory last November, part of a political and economic transformation that is bringing an end to more than five decades of isolation.
"The debut is an important milestone because a stock market is a vital ingredient for economic development," said Hong Kong-based partner Karine Hirn of East Capital Asset Management, which invests in emerging and frontier markets.
"Whether it will be successful or not depends on the willingness of the government to prioritise it."
The listing debut was attended by First Myanmar's Mr Pun and officials including Deputy Finance Minister Maung Maung Thein, who is chairman of the Securities and Exchange Commission (SEC). Mr Maung Maung Thein called it "a historic day in the development of the capital markets". He told an assembled crowd of business leaders: "We can now proudly and mightily proclaim to the world that we are no longer a backward nation."
First Myanmar, Myanmar Citizens Bank and Myanmar Thilawa SEZ are among the initial batch of six firms approved for listing, Mr Maung Maung Thein said in December.
The country's equity market journey began in the early 1990s, when executives from Daiwa Institute of Research, a unit of Japan's second- largest brokerage, went to Myanmar and met its military rulers. The initial target was to start a bourse by 2000. The region's financial crisis soon derailed those ambitions and it was not until 2011, after the quasi-civilian government began opening up Myanmar's economy, that the exchange plan was revived.
As Myanmar emerges from economic isolation, it will need US$80 billion (S$110 billion) worth of power, transport and technology projects through 2030 to modernise its economy, according to the Asian Development Bank. Buoyed by a flood of foreign direct investment, the ADB estimates the country's economy expanded 8.3 per cent last year and will grow at nearly the same pace this year.
Foreign investors will be able to trade on the exchange once Myanmar's new government, which takes office next week, passes revisions to the companies law, the Myanmar Times reported in December, citing SEC head Mr Maung Maung Thein. The SEC has not said whether foreign investors will face any investment restrictions.