Tunisia will launch a small-cap stock market next month as part of reforms to boost investment and stimulate the economy, the head of the country's financial market authority said. The new market will make it easier for small companies to list by offering less onerous financial reporting and profitability requirements than the bourse's main market.
The first company due to list is food producer Mliha, which will begin trading in the first week of December with a market capitalisation of 6 million dinars ($4.91 million). The goal is for 20 firms to be listed by next year.
"The alternative market is designed for the small firms that make up 90 percent of Tunisia's economic network," said Zeinab Guallouz, president of Tunisia's Financial Market Council (CMF).
"The financial market will respond to the needs of small firms and will finance the restructuring plans they require in order to invest," she told reporters at an investment conference ending on Saturday. Guallouz said small cap firms in Tunisia lacked critical mass and too few had opened their capital to the public. The alternative market would help them grow, access bigger markets and become more robust as trade barriers fall and competition grows.
"The solution is the alternative market because you can't finance a project of three or four years using a bank credit," she said. Companies planning to list only need to provide one year's financial results, instead of the normal two years, but must demonstrate transparency, efficient information provision and a solid business plan, Guallouz said.
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