Envisaging Methods and Goals for the Sana’a Stock-Market’s Basic Structure [Archives:2001/20/Business & Economy]

May 14 2001

In its new economic policy and program, the government has assured its control and reform of the banking system. The government, thus, will be establishing the Sana’a Stock-Market on a stable foundation.

Finance environment private sector.
The project also envisages providing confidence to Arab foreign investors for free investment, utilizing all available opportunities in the market, as well as exploiting other opportunities in other distinct fields.
A committee, appointed by the previous cabinet to study other countries stock markets prior to Yemen’s foundation of stock-markets, is likely to explore, as soon as possible, Yemen’s potential to start such a market.
The committee is to identify the modern and necessary services for individuals, companies, organizations, and brokers who are expected to benefit from this important market.

Facing slow investment operations
Absence of a stock-market in Yemen, as business-men believe, maybe a basic cause for turning off investors who fail to start their investment projects. This road block creates difficulties in securing banking-loans exposing their projects to major risks.
However, existence of a stock-market would enable investors to put money in the market and to approach share-holders to implement the investment projects. These share-holders in turn may have the opportunities to go ahead with their projects.
Hence, it is suggested by banking-systems experts that there should be statistics to estimate volume of the stock-market component in the public sectors.

Means of Assignment
Accurate planning to establish this market represents a challenge which requires efforts from two directions. First, finding a monetary circulation net based on the most recent applied methods in banking markets. This includes availability of highly advanced technology and hot lines to ensure confidentiality.
The trading floor, if Arab modern banking markets are to be surveyed, has to be equipped with up-to-the-minute modernized companies, organizations, and monitoring local and external economics activities affecting the stock-market while serving the dealers.
More over, the market should be constructed with the required modern mechanical exchange-systems, efficient enough to function in accordance with international standards of monetary circulation. It should have a facility for dealers to tie in their systems for dealing with Arab and international stock-markets so as to accelerate the attraction of investors.

Branches in the government
The basic hall for this stock-market has to be extended to the other governors ;especially in the free zone of Aden. The branches are to be joined to the base with advanced technology. An investors’ club seems very essential, as it is the case in Cairo. It is to be provided with data and information demonstration equipment in the circulation traffic.

Human working-elements
The other issue to be taken care of is the preparation of the human working-systems. Dealers, too, have to be trained to deal with the alike systems. Execution of informative details about campaigns to make people aware of the market’s goal and objectives and various scopes for investment, is of no less importance. Investment opportunities in Yemen are in fact as ample for international investors as they are abroad.

Stock-market promotes Banking
No doubt, the birth of this market would facilitate investments here. It would offer acceleration of banking activities with access to a data and information control system which would educate the customers about the trends in market and indicators on time.

Other advantages of the market
It would encourage speculators to put their stored capital in the market for movement, and control the unorganized importation of goods and services for the purpose of storing until prices rise. Such importers would be forced to buy shares and employ their available liquid assets in the stock-market in order to obtain profits.
Finally, let’s assume that the focus of the government on establishing this market, is a step in the right direction. It has a vital role to play in improving the economy and an increase in investments as well as to attract international capital.