Government has encouraged the Small Medium and Macro Enterprise (SMME’s) businesses to list on the Botswana Stock Exchange (BSE).
The move list will better position such entities to raise capital to pursue investment opportunities across the country and across the region, says Vice President Mokgweetsi Masisi
Speaking recently at the annual BSE listings conference, Masisi said the SMMEs would be in the process create employment for the local population, enhance the availability and accessibility of products and service and contribute to the growth of the country’s Gross Domestic Product (GDP).
Masisi observed that in the past two decades they a global trend of enormous wealth creation by young entrepreneurs from all over the world who have managed to build phenomenal businesses with a global reach, have created employment.
He added that there have been significant improvement of standards of living and that of communities. He stated that all this was made possible by these business owners making the decision to raise capital through the markets in their respective nations.
“Within every challenge exists an opportunity. The opportunity exists for the business community to now take the reins and diversify our economy from where it is currently,” said Masisi.
He is of the view that it is the opportune time for SMMEs to harness the power of innovation and bring it to reality by seeking the assistance they need in terms of financing through the BSE.
He added that it also benefits the man on the street as well as benefiting the ordinary citizens who can in turn invest in listed securities and improve their financial statuses.
He believes that by increasing the number of listings, the liquidity of the markets will be enhanced adding that this will attract more participants to the capital markets; improve the quality and efficiency of information.
“In future we will look towards funding more projects and continuously review our laws for any regulatory constraints that may inhibit the participation of more businesses or that could inhibit the growth of the exchange,” said Masisi.
Chairperson of Milken Institute, USA, Staci Warden said the listings outreach and awareness efforts were working, adding that, however, SMMEs needed to know more about the costs of ongoing listing requirements.
Warden stated that when unlisted firms have positive views of what was going on the public would want to follow suit.
She observed that firms that list appreciate the benefits of listing, they do not like surprises, adding that handholding seems to matter and that exchanges can do more to prepare SMMEs for reality.
“Large percentages of firms report improved financial performance and profitability in India and Jamaica. The experience of listing exceeded expectations for a majority of Jamaican firms in terms of positive public exposure,” she said.
Warden stated SMME boards appear to do a better job mitigating perceived drawbacks to going public than main boards. She said the finding suggests that the extra support provided by exchanges and authorised advisors makes a positive difference for SMMEs listing, compared to main markets.
She stated that when companies list, they then have reputational gains and also improve in corporate governance and reporting.