ASEAN Exchange to attract growing domestic businesses

Manila, Philippines -  Finance Secretary Cesar Purisima said the ASEAN Exchange would encourage a deeper pool of liquidity from growing domestic businesses to consider listing.

Likewise, the regional bourse would stimulate domestic corporates towards larger international ambitions. The ASEAN Exchange is a collaboration of stock markets from Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

In an interview with FinanceAsia, Purisima said the Philippines has companies that “are starting to go beyond the boundaries of the Philippines.”

“Getting funding from outside is crucial not just from a capital perspective, but also in terms of matching risk,” he said.

Among the progressive companies and conglomerates going regional are San Miguel Corp., International Container Terminal Service Inc. (ICTSI) and Jollibee Foods Corp.

However, Purisima told the regional publication that encouraging small businesses to list in the local bourse for regional expansion, and urging large firms and corporates to go regional has a price.

Good corporate governance and increased transparency is a must in the regional and global markets, he said. Investor confidence has since improved as evidenced in the nation’s cost of borrowing. In January, the government priced a $1.5 billion, 25-year global bond at the lowest coupon it has ever achieved for a long-dated bond.

The ASEAN Exchange took off in 2011 when the Stock Exchange of Thailand (SET) launched the ASEAN Broker Networking in Phuket. The event started cross-border partnership among ASEAN brokers, with 62 brokers of the stock exchanges in Southeast Asia including Bursa Malaysia, Hanoi Stock Exchange, The Philippine Stock Exchange, The Singapore Exchange and SET.

Then in April this year, the chief executive officers of the ASEAN Exchange announced the ASEAN Trading Link that will initially connect Bursa Malaysia, Singapore Exchange and the Stock Exchange of Thailand by August 2012.