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Ghana
The gateway to west Africa. |
 Introduction
The Ghana Stock Exchange since 1990 has been gradually facilitating the development of capital market in Ghana. The Exchange has put in place the facilities for businesses and the Government to raise long-term capital as well as for investors to obtain liquidity, reasonable capital safety and diversity of investments. Since its establishment, many companies as well as the government have raised funds through the floatation of company shares to the general public.
Brief History:
the Ghana Stock Exchange was incorporated in July 1989 as a private company limited by guarantee under Ghana’s Companies Code, 1963. The Exchange was given recognition as an authorized Stock Exchange Act of 1971 (Act 348) in October 1990. The Exchange however, changed its status to a public company limited by guarantee in April 1994. Trading on the floor of the Exchange commenced in November 1990.
Types of Securities Traded & No. Of Listings
Ordinary Shares (Common Stock) 22
Debt Securities - Corporate 4
- Government none
Trading:
Trading in securities on the Exchange takes place three times a week on Mondays, Wednesdays and Fridays starting at 10 am. Over the counter trading is however allowed in Ashanti Goldfields Company’s shares. Trading is on the Floor of the Exchange under the Call-Over system with limited auction underpinning. The authorized dealing officers who are representatives of Stockbroking firms assemble on trading days on the floor and a designated official of the Exchange presides over the transactions and also directs the conduct of business on the floor. Trading is done in lots of 100 shares, except in Ashanti Goldfields shares for which 10 shares area a round lot.
Commission Rates:
A minimum of 1,500 cedis(about US$.5) is charged on trade value not exceeding 10,000 cedis (about US$3.3). For trades greater than 50,000 cedis (US$17), a declining rate from 2.5% to 1% as the trade value increases, is applied.
Regulations Affecting Foreign and Non-Resident Investors:
There are few regulations affecting foreigners and non-resident investors. Exchange Control permission has been given to non-resident Ghanaians and foreigners to invest through the Exchange without prior approval. However, tone external resident portfolio investor (whether individual or institutional) can hold only up to 10% of any security approved for listing on the Exchange. Furthermore, the total holdings of all external residents in one listed security shall nit exceed 74%. There is free and full foreign exchange remittability for the original capital plus all capital gains, returns and related earnings.
Taxation:
There is a 10% withholding tax (which is also the final tax) on dividend income for all investors, both resident and non-resident. Capital gains on listed securities are, however, exempt from tax until November 2000. There is also no stamp duty.
Market Performance:
GSE ALL Share Index over the past nine years increased from 77.65 in Nov 1990 to 759.93 by the end of September 1999. It ended with a whooping gain of 69% making the Exchange the best performing in Africa for the year 1998. This is to complement GSE’s achievements as the 6th best performing market in 1993 with an index gain of 116% and the best among all the emerging markets in 1994 with an index gain of 124%.
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GSE ALL-SHARE INDEX
Nov 1990 - 77.65 change
Dec 30,1991 - 64.51 -16.92%
Dec 31,1992 - 62.17 - 3.63%
Dec 31,1993 - 132.88 113.74%
Dec 31,1994 - 298.10 124.34%
Dec 31,1995 - 316.97 6.33%
Dec 31,1996 - 360.76 13.82%
Dec 31,1997 - 511.74 41.85%
Dec 31,1998 - 868.35 69.69%
Sep 30,1999 - 759.93 -12.49%
Total market capitalization increased from 330.46 billion in Nov 1990 to 3,238.38 billion cedis as at Sept. 30, 1999.
Total volume of shares traded from Nov 1990 to Sept. 30, 1999 were 469 million valued at 395,112.15billioin cedis.
Over 160 billion cedis has been raised by 12 companies through the Exchange since November 1990.
Future Prospects
The Exchange as part of its strategic plans has initiated certain actions aimed at increasing awareness of the role of the securities market amongst the general populace. An automated trading, clearing and settlement system, will be installed by end of year 2000. Development of new financial products such as collective investment schemes and municipal bonds are also high on the agenda of the Exchange. The Exchange expects to have more privatized SOE’s listed. Additionally, there is a project currently going on to increase listings.
The Exchange as a result of all these prospective developments coupled with good indications of a stable macro-economic environment is looking forward to increased stock market activities in the coming years.
For more information contact the following Stockbrokers
Merban Stockbrokers Limited
Tel: 233-21 666331-3
Fax: 233-21 667305
EBG Stockbrokers Limited
Tel: 233-21 667109
Fax: 233-21 775406
NTHC Ltd.
Tel: 233-21 229664/229106
Fax: 233-21 229975
Gold Coast Securities
Tel: 233-21 226310/229892
Fax: 233-21 777380
Databank Brokerage Ltd.
Tel: 233-21 669110/669417
Fax: 233-21 669100
First Atlantic Brokerage Ltd.
Tel: 233-21 667088/666909
Fax: 233-21 77543
SDC Brokerage Services Ltd.
Tel: 233-21 669372
Fax: 233-21 669371
CDH Securities Ltd.
Tel: 233-21 667425/667428
Fax: 233-21 662167
CAL Brokers Ltd.
Tel: 233-21 221056
Fax: 233-21 231913
Strategic African Securities Ltd.
Tel: 233-21 229816
Fax: 233-21 229816
New World Investments Ltd.
Tel: 233-21 660163
Fax: 233-21 228610
Sterling Securities Ltd.
Tel: 233-21 764332/5
Fax: 233-21 762954
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© World INvestment NEws, 1999.
This is the electronic edition of the special country report on Ghana published in Forbes Global Magazine.
March 20th 2000 Issue.
Developed by AgenciaE.Tv |
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GHANA
