|
|
History The Egyptian Stock Exchange is the product of the merger between the Cairo and
Alexandria Stock Exchanges. They now share the same board of directors whose chairman is the head of both Exchanges. The Cairo & Alexandria Stock Exchanges have a long heritage with the former
opening in 1903 and the latter in 1883. The exchanges are now unified and linked electronically to allow real time trading
through a screen trading quote driven system, thus speeding up transactions and reducing administration. The market
capitalization of the Egyptian stock exchange has grown by an average of 40% per annum over the last five years,
reaching US$ 36.7 (LE 128.4) billion by the end of May 2000. Synopsis Of the 1039 listed companies, around 90 are actively traded. Over 400 listed companies
are closed family companies, which are listed to qualify for tax benefits. Such a policy is still being implemented
with the result that more and more privately held companies are now looking towards the capital markets as a source
of equity based growth. In fact, after the early impetus provided by privatization, privately owned companies,
as of 1997 and 1998, have constituted an active element in primary and secondary offerings. The performance of the stocks on the ESE is reflected in the Egyptian Stock
Exchange General Index, produced by the CMA (Capital Markets Authority) and covers all the listed companies. Local
brokers produce other indices. Egypt was included in the International Finance Corporation’s composite index as
of January 2, 1997 and in the investible index (IFCI) as of November 3, 1997. The country’s weighting is 1%. Other
entities such as Morgan Stanley Capital International cover the market, on a standalone basis.
However, Egypt has
not been included in their bench emerging markets index yet.
*As of May 2000 (Source; Cairo & Alex Stock Exchange Statistical Bulletin, CMA, Reuters) Egypt’s economic growth also benefited from the government’s privatization program.
The legal basis for privatization was established in 1991 under Law No.203, as part of the economic reform program.
Privatization is often cited as the main impetus behind the rapid growth of the Egyptian stock exchange’s trading
and capitalization in the recent period. Noteworthy
Characteristics. -
There are no restrictions with regards to international foreign investment or
trading. -
There are 8 Egyptian companies that have their shares traded in London as GDR’s -
No stamp duty.
-
Mutual funds exempt from income tax. -
Zero Capital Gain tax for individuals & corporations investing in securities.
-
Zero taxes on dividends. Contact Information: Cairo and Alexandria Stock Exchanges Tel: +20 (2) 5753786 or +20 (2) 5748605/8 |