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

Experts and bourse players react

Content image - Phnom Penh Post

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

  • Website advises travellers to stay clear of Angkor Wat

    An Australian website has advised travellers to avoid Angkor Wat during their trip to Southeast Asia because the ancient temple is showing signs of rapid erosion and faced water management issues. In a recent article entitled Best places to go in 2020: 12 destinations you should avoid

  • First deportees of the year touch down in Cambodia

    Twenty-five Cambodian-Americans landed in Phnom Penh on Wednesday, marking the first such deportations of the year. “On Wednesday, US law enforcement authorities deported 25 Cambodian nationals that immigration judges determined had no legal basis to remain in the US,” said Arend Zwartjes, spokesperson for the US

  • Passenger taxi boat ridership sinks despite free services

    Passenger taxi boat traffic has dropped by about five per cent compared to the same period last year, despite the government providing free service for garment workers until next year, Phnom Penh Autonomous Bus Transportation Authority director Ean Sokhim said on Monday. In 2018, the Phnom

  • Kingdom drafting new law to strengthen immigration

    The Ministry of Interior on Tuesday said it had formed a working group to draft amendments to the Law on Immigration. Its secretary of state Sok Phal told The Post that the amendments will strengthen the management of immigrants in line with the current situation.

  • Qatar Airways to connect Doha and Siem Reap town

    Qatar Airways Company QCSC has announced a new route connecting Qatar’s capital Doha with Siem Reap, a move hailed by local officials as a significant step to boost tourist numbers. A Qatar Airways representative, speaking at the Kuwait Aviation Show, announced on Thursday that

  • Jica seeks to turn PP, towns into smart cities

    Japanese International Cooperation Agency (Jica) representatives have sought support from Siem Reap’s Apsara National Authority (ANA) to transform the ancient capital into a smart city. The call was made in February last year after the government approved three cities to join the Asean Smart