The Yangon Stock Exchange (YSX), set to open in October this year, is to see up to US$20 billion in Market Capitalisation as well as trade volume of US$10 billion per year, said Dr Aung Thura, CEO of Thura Swiss during the ASEAN- Myanmar forum held on March 23 at the Park Royal Hotel, Yangon.
“If we were to take Vietnam as an example, Myanmar is looking towards achieving US$20 billion worth of Market Capitalisation. Trade volume also can reach up to US$10 billion annually,” according to Dr Aung Thura.
Vietnam Stock Exchange (VSX) reached a Market Capitalization worth US$20 billion from 2005 to 2010. At the start of the VSX, it saw rapid increase in investment but saw a drop of 40 percent in Market Capitalisation which is heavily influenced by the State Bank of Vietnam and the banking sector as a whole. The situation for YSX is better than the initial situation of the VSX in 2005. Due to slow development in the banking sector, YSX’s Market Capitalisation has more chances for growth.
Myanmar’s Credit to GDP ratio is 31 percent only as compared to Vietnam’s ratio of 130 to 135 percent. However, illegal businesses are still flourishing in Myanmar, the YSX may become a place to transform black money into white money.
“A lot of business sectors in Myanmar are still overwhelmed by black money; I hope that when YSX is opened, it does not become a place to make black into white money as it runs a very high risk of the stock market collapsing in the long run. We need laws and regulations as well as proper knowledge of methods of changing the illegal money to legal money,” warned Dr Aung Thura.