Logo of Phnom Penh Post newspaper Phnom Penh Post - Experts and bourse players react

Experts and bourse players react

Experts and bourse players react

THE decision to list in riel will likely have little impact on the success of the Cambodia Securities Exchange, provided the NBC ensures a relatively stable riel-dollar exchange rate, according to a currency expert.

Late last week, the Securities and Exchange Commission of Cambodia announced that firms would be listed in riel only on the exchange, but would allow settlement in either the dollar or the riel for the first three years.

Asian Development Bank Office of Regional Economic Integration Principal Economist Jayant Menon wrote that the currency of settlement – rather than the currency of listing - was the “critical variable”.

“As long as the NBC [National Bank of Cambodia] can ensure a relatively stable riel-dollar exchange rate, which it has been doing particularly recently, then listing in riel should not matter much,” he said.

There could initially be some negative psychological impact on potential foreign investors, he said, but it should dissipate especially with the decision to leave open the currency for settlement.

“One should not overplay the role of the currency in ensuring the success or otherwise of the new exchange,” Menon wrote, adding other factors such as accounting standards, macro and political stability, and institutional development would be more important.

“A successful stock exchange will help the process of dedollarisation in the long run. The currency in which stock prices are quoted will hardly matter.”

Meanwhile, future actors in the stock exchange added their reaction to the decision yesterday. Kuy Bat, chairman at approved underwriter Phnom Penh Securities, said he supported the decision to use the riel for listings, but it could initially impact foreign investment on the exchange.

“It may have a slight impact for investors at the initial stage, but won’t impact the whole [economy],” he said. He added the decision to list in domestic currency was in line with most countries around the world.

Telecom Cambodia Director General Lao Saroeun said yesterday the firm followed the government’s lead regarding listing on the exchange.

“I agree with the government’s decision” he said.

While Phnom Penh Water Supply Authority assistant to director general Chea Visoth supported the government’s choice. “We can promote our local currency,” he said.

MOST VIEWED

  • WHO: Covid in Cambodia goes into new phase

    The World Health Organisation (WHO) in Cambodia said that Cambodia has reached a new phase of the pandemic with “decreasing case numbers, high vaccination coverage and a more transmissible circulating variant threatening a hidden surge”. In a press release on September 6, the WHO said that

  • Purging Sihanoukville’s past with a new masterplan

    Amid illicit activities, haphazard development and abandoned projects, the coastal city of Sihanouk province needs a reset to move forward. A new masterplan might be the answer to shake off its seemingly mucky image to become the Shenzhen of the south Gun toting, shootouts, police

  • 'Pursue your goals, reach out to me': Young diplomat tapped as envoy to South Korea

    Chring Botum Rangsay was a secretary of state at the Ministry of Foreign Affairs and International Cooperation before being designated as the new Cambodian ambassador to South Korea. According to her official CV published on the foreign ministry’s website, she started her first government

  • International air visitor arrivals dip 93%

    The number of foreign tourists entering Cambodia through the Kingdom’s three international airports witnessed a sharp 92.5 per cent year-on-year decline in the first seven months of this year, according to the Ministry of Tourism. The airports handled 51,729 international tourists in the January-July period versus

  • School reopening ‘offers model for other sectors’

    World Health Organisation (WHO) representative to Cambodia Li Ailan said school reopening process should be used as a role model for reopening other sectors currently mothballed by the Covid-19 pandemic. Li strongly supports the government’s decision to reopen schools, saying it is a decision

  • Covid jab drive for 6-11 age group to begin Sept 17

    Prime Minister Hun Sen has permitted Covid-19 vaccinations for over 1.8 million children aged 6-11 across the country from September 17 in order for them to return to school after a long hiatus. Hun Sen also hinted that vaccinations for the 3-6 age group will follow in