Further listings expected on bourse
The Palestine Exchange (PEX) is finalising plans to become the second listed exchange in the region after the Dubai Financial Market (DFM).
“Our first trading session as a listed exchange will be on 4 April,” says Ahmad Aweidah, chief executive officer of PEX.
Currently, the major shareholder is Padico which owns 78 per cent, followed by the Palestine Investment Fund (PIF) with 17 per cent and the Euromena Fund, managed by UK-based private equity firm Capital Trust Holdings, holds 5 per cent.
“With the listing and flotation, that will change,” says Aweidah.
The bourse has been growing rapidly over the past few years with more listings in the pipeline. Ramallah-based pharmaceutical company Pharmcare is expected to list its shares on 23 April.
In 2011, seven new companies listed on the PEX, although only one was through an initial public offering (IPO). This increased the PEX’s market capitalisation from $400m to $2.8bn.
Currently, the PEX is lobbying with the Palestinian Authority (PA) to reconsider proposed amendments to the tax law, which is expected to be applied on 15 May. Under the plans, the PA intends to introduce a capital gains tax on trading and to double corporate tax rates from 15 per cent to 30 per cent with the aim to raise some $350m annually.
“The impact will make the market less exciting and trading more expensive. It would make the market less competitive and will not raise a lot of money. We should be making it cheaper and more accessible to trade instead,” says Aweidah.