Cambodian bourse is still on in spite of the current economic context?

Korea Exchange to jointly launch Cambodian bourse

SEOUL, March 24 (Reuters) - The Korea Exchange (KRX) said on Tuesday that it had signed an agreement with the Cambodian government to jointly launch a Cambodian stock exchange by the end of 2009.

The Cambodian government and KRX will control 55 percent and 45 percent of the exchange, respectively, and will jointly operate the bourse, KRX said.

The announcement marks the latest effort by the South Korean exchange to expand its presence abroad.

In November 2008, KRX signed a memorandum of understanding with Laos government on setting up the country's stock exchange, with the South Korean bourse holding 49 percent of the venture.

(Reporting by Jungyoun Park; Editing by Jonathan Hopfner)

Cambodia's ambitous plans for stock exchange proceeding

Wednesday, July 30, 2008
ABC Radio Australia

Cambodia is moving ahead to establish a stock exchange by the end of next year, as one of South East Asia's poorest nations, Cambodia hopes money raised through a stock exchange will allow companies to expand.

It's getting advice from the South Korean Stock Exchange while Korean companies are building the physical and financial infratructure for the exchange.

Presenter: Karon Snowdon
Speakers: Marvin Yeo, Managing Partner with Frontier Investment Partners of Singapore and Cambodia; Professor Douglas Arner, Director of the Asian Institute of Internatiional Financial Law at Hong Kong University

Click here to listen the program in English

Cambodia Inks Stock Market Deal for 2009

By Mean Veasna, VOA Khmer
Original report from Phnom Penh
24 January 2008

The government signed a stock market contract with Korea Exchange Monday, paving the way for an exchange starting mid- or late 2009, officials said this week.

Korea Exchange is the fourth largest stock market in Asia.

The government plans to allow at least 10 companies—five state run and five foreign—to be listed on the initial exchange, officials said.

The news was met with mixed feelings. Some analysts warn that the rampant corruption and weak rule of law that continually plague Cambodia will sink stock exchange efforts.

But some officials were optimistic the stock market could provide more sophisticated options to investors.

“The Cambodian stock market provides an additional opportunity for a company to collect capital for investment,” said Hang Chuon Narong, general director of the Ministry of Economy and Finance. “Either [the company] deposits money to get interest, or it invests in the stock market.”

The impending stock market, which stems from the signing of a securities law last year, will help strengthen Cambodia’s financial system and will ensure money circulates “smoothly,” said Kang Chan Dararoath, an independent economic analyst.

Opposition leader Sam Rainsy, who was once Finance Minister, encouraged Cambodians to buy shares in stocks to increase their income, but warned extreme caution.

“Our current authorities are corrupt and conspiratorial, and if the stock market is created under these circumstances, I worry that some people can be cheated,” he said. “They could lose a lot of money and become much poorer.”

S.Korea, Cambodia to open JV stock exchange in '09

SEOUL, Jan 22 (Reuters) - South Korea's stock exchange operator said on Tuesday it had agreed with the Cambodian government to set up and run a joint stock exchange in the Southeast Asian country in 2009.

The Korea Exchange , Asia's fourth-largest bourse operator, has in recent years supported stock market development in Southeast Asia as part of efforts to raise its profile and draw foreign firms to Seoul for listings.>

KRX said in a statement the exchange and the Cambodian Finance Ministry were working on a detailed investment plan to set up the Cambodia Stock Exchange and a support system next year.

The Cambodian government will own a minimum 51 percent in the new bourse while KRX will hold as much as 49 percent. KRX will also help the country set up a regulatory body to oversee stock trading, it said.

South Korea said last year it would spend $1.8 million in training and help set up the modern stock market in Cambodia, which is recovering from a 30-year civil war ended in 1998.

Cambodia moves toward creating stock market as lawmakers pass securities law

Wednesday, September 12, 2007
The Associated Press

PHNOM PENH, Cambodia: Cambodian lawmakers approved a securities law Wednesday in the latest move to prepare the country for establishing a stock market in the next two years.

The adoption of the law on issuance and trading of nongovernment securities occurred just one week after the government's announcement of its bid to create a stock exchange in 2009.

All 79 lawmakers who attended the session of the National Assembly, the lower house of parliament, voted for the law that Finance Minister Keat Chhon said is based on international best practices for stock markets. To be enacted, the law needs approval by the Senate and to be signed by king, but those two steps are largely formalities.

He said a stock market could be set up in the first half of 2009 but that a lot of work remains to be done by the government.

Beside having to introduce more laws, he said building premises and installing the information technology network necessary for electronic trading are the major tasks that could cost up to US$15 million (€11 million).

Keat Chhon said the government will be looking for foreign partners in the project, which will be beneficial for the country's economy.

"There will be a financial market, a bond market, a stock market for companies to mobilize capital outside the banking system to invest and do business," he told reporters.

Cambodia's banking system has seen signifcant growth in deposits in recent years but still remains too weak to offer financing for any long-term investment projects, according to business experts.

The Cambodian economy has been one of the fastest growing in Asia, expanding at 11.4 percent in each of the past three years. However, its development has been heavily reliant on hundreds of millions of dollars (euros) in international aid.

Foreign donors have also urged Cambodia to diversify its economic structure, which has largely been based on the textile industry. Last year, garment exports were worth US$2.6 billion (€1.9 billion) and accounted for nearly 80 percent of Cambodia's total exports.

In launching a plan for a stock market last week, Prime Minister Hun Sen said foreign aid and increases in bank financing have yet to meet the demand for capital to develop the country.

According to the new law, any person committing insider trading can be punished with from five to 10 years in jail and fined from 20 million riel to 100 million riel (US$4,900; €3,545 to US$24,390; €17,640).

It also says securities firms that breach insider trading rules will be fined from 50 million riel to 1 billion riel (US$12,195; €8,820 to US$243,900; €176,430).

Cambodia passes stock market law

PHNOM PENH, Sept 12 (Reuters) - Cambodia's parliament passed legislation on Wednesday to allow a stock market to open in 2009, another concrete step in the Southeast Asian nation's recovery from the devastation of Pol Pot's "Killing Fields".

South Korea has pledged $1.8 million in aid and technical assistance from the Seoul stock exchange to get the Phnom Penh bourse off the ground. Overall, the launch would cost $15 million, Finance Minister Keat Chhon said.

Government officials tout the planned stock exchange opening as evidence of their restructuring the economy to increase investment and drive growth. The opposition says it is just as likely to make corrupt government officials rich.

As many as 400 companies are thought to be possible candidates for flotation in the nation of 13 million.

Much of Cambodia's economy is dependent on agriculture, although it has some proven off-shore oil and gas reserves, a vibrant garment industry and booming domestic construction and telecommunications sectors.