Lao stock market moves closer to online trading
Lao stock market moves closer to online trading
The Lao Securities Exchange plan to offer online stock trading has seen some positive progress after the Lao-Korean joint venture agreed to purchase the necessary IT and communication equipment from a Korean company.
The Exchange signed an agreement with Korea Telecom last week to purchase, install and maintain IT equipment in Vientiane, to enable the Lao Securities Exchange to offer online stock trading services.
Under the agreement, Korea Telecom will also train Lao stock market staff so they can use the equipment to boost the efficiency of stock trading, which it is hoped will attract more local and foreign investors to the Lao stock market.
Lao Securities Exchange signed an MOU with Enterprise of Lao Telecom earlier this year to provide the stock market with a high speed and secure internet signal, one of the main requirements to enable the market to offer smooth online trading services.
Despite the fact that the stock market has posted an order to purchase the IT equipment, it is still unclear when the system will be operational so that online trading can begin.
LSX Chairman and CEO Mr Dethphouvang Moularat said earlier this year the Exchange would try its best to offer online trading in the first quarter of this year. However, the deadline has passed without the service coming into effect.
The Lao stock market has strong hopes that the online service will make it easier for traders to post purchase and sell orders from home over the internet, thus boosting trading volumes and the number of companies that want to list.
At present, traders have to use telephone and fax to post buy and sell orders with brokers, while some traders have to visit the stock market in person.
Most stock markets now offer an online trading service and many Lao people can buy and sell stocks in foreign markets. The fact that they cannot do so in Laos is resulting in an outflow of foreign currencies.
The Lao Securities Exchange was opened in October 2010 and first offered a stock trading service in January last year. Currently, only two companies, EDL-Gen and BCEL have listed. The management of the exchange said earlier this year that an average of 160,000 stocks a day traded last year, below what had been expected.
Many Lao people consider investment in the stock market to be a new experience and they need to understand more about the process before they are confident about investing. A shortage of stock market and economic data has also made it difficult to convince people to invest in the publicly listed companies.
vientiane times
