Laos opens new stock exchange

January 11, 2011 | 13:58

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Communist Laos launched its first stock exchange on Tuesday, an official said, in the latest capitalist step by the rural-based nation aimed at spurring development.

The Lao Securities Exchange (LSX) opened after a morning ceremony, said Khenthong Nuanthasing, the Lao government spokesman.

Only two stocks are initially listed: EDL-Generation Public Company -- which was spun off in December from state-owned Electricite du Laos to handle power generation -- and state-run Banque Pour Le Commerce Exterieur Lao.

The exchange's chairman, Dethphouvang Moularat, is confident that the bourse's opening will be a milestone for the nation where the majority of people still live on less than two dollars a day.

"It will help the economy a lot," he told AFP in an earlier interview at the stock market's modern, glass-fronted headquarters in Vientiane.

He said the bourse would complement an existing foreign exchange market, giving firms access to vital capital for expansion.

To develop its exchange, Laos sought technical and financial support from South Korea -- whose own stock market operator has a 49-per cent stake in the LSX -- as well as advice from neighbouring Thailand.

Laos, with about six million people, is one of Asia's poorest nations but has been growing at about seven per cent annually in recent years, the government says.

Donors and non-governmental organisations have cautioned Laos over its growth strategy, which features large-scale foreign investment in resource sectors that potentially could have negative effects on socio-economic development.

Laos is working towards membership of the World Trade Organization.

AFP

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