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

  • Kingdom accepts Chinese vaccine, PM first to get jab

    Prime Minister Hun Sen said China would offer Cambodia an immediate donation of one million doses of the Covid-19 vaccine produced by the Sinopharm company. In an audio message addressing the public on the night of January 15, he said Cambodia has accepted the offer and

  • Reeling in Cambodia’s real estate sector

    A new norm sets the scene but risks continue to play out in the background A cold wind sweeps through the streets of Boeung Trabek on an early January morning as buyers and traders engage in commerce under bright blue skies. From a distance, the

  • Hun Sen: Lakes filled in for national developments

    Prime Minister Hun Sen has announced continued operations to fill some lakes in Phnom Penh to create land for developments, though he is against the unrelated practice of damming rivers or blocking waterways. Speaking at the inauguration of the Ministry of Public Works and Transport

  • Koh Preus upgrades 70% complete

    Initial construction of a nearly $30 million tourism infrastructure project on Preah Sihanouk province’s Koh Preus Island is “about 70 per cent complete”, according to an official with the developer. Heng Thou, construction site manager of Angela Real Estate Co Ltd (ARE), told The Post that

  • Local media loses a giant, and The Post a great friend

    Cheang Sokha, a gifted and streetwise reporter who rose to the highest ranks of Cambodian media and was beloved for his sharp intelligence, world-class humour and endless generosity, died on Friday in his hometown of Phnom Penh. He was 42. His wife, Sok Sophorn, said he

  • Cambodia, India agree to start direct flights, tourism exchanges

    Cambodia and India have agreed to start direct flight connections and promote closer tourism exchanges and cooperation in all areas after the Covid-19 saga comes to a close. The agreement was reached during a meeting between Cambodian Minister of Tourism Thong Khon and newly-minted Indian