Wednesday, July 2, 2008
Kenya to soon get NASDAQ-like Exchange to promote funding at bottom tier
It's very exciting to see that the Capital Markets Authority is stedfastly progressing towards the opening of another stock exchange to service Over The Counter (OTC) transactions.
The OTC market is expected to primarily serve Small and Medium Enterprises (SMEs) engaged in productive activities such as manufacturing, information technology, finance, land-related investments.
Going by experiences in other countries it is clear what the impact of the introduction of an OTC market in India in 1990 (!) has had on that economy. The OTCEI in India calls itself the exchange for Technology and growth stocks and has supported the capitalisation and growth of enterprises that have become worldwide brands. The Indian OTC market has over 115 listings.
This will definitely be a significant milestone in the development of Kenya's economy as current estimates show at least 22,000 SMEs which serve as potential to list on the OTC.
It is anticipated that the OTC should open by around October later this year.