6 November 2009
Windhoek — The Namibia Stock Exchange shared in the strong global growth since 2003, with the overall index increasing from 259 at the end of March 2003, to peak at 1034 on 11 October 2007.
Subsequently, however, most of these gains have been eroded, with the Overall index closing on 31 March 2009 at 479 up by 299% to October 2007; down by 46% since then; nevertheless resulting in a net gain of 85% over the period.
Chairman Peter Koep said in the 2008 annual report that trading on the NSX during 2008 was volatile, with four months in the second half of the year exceeding N$ 1.2 billion each.
The total trades were N$ 9.132 billion, compared to the N$ 10.892 billion in 2007. Even though the volume of trades increased by 20% compared to 2007, an increase in volume does not necessarily result in increased profits, as the NSX fees are based on value, unlike the JSE where volumes drive the fees. In the first quarter of 2009, the volumes over 2008 are 29.3% up, with values static with January 2009, being the best January in the history of the NSX, he said.
The NSX is a fixed cost business, and its operating costs have remained static at around N$ 3.4 million in both years.
The surplus of N$ 4.9 million reported for this last year compares favourably to the surplus of N$ 6.07 million in 2007.
"Like most exchanges, and as may be expected in these turbulent times, the NSX experienced a reduction in the number of listings, with a major primary listing being delayed indefinitely and fewer dual listings being experienced, particularly in the exploration mining sector. In the mining sector, this trend was exacerbated by the expressed intention of the ministry of mines and energy to impose conditions on black economic empowerment compliance with regard to the renewal of mineral licences without an appropriate legal framework being in place.
Finding the correct balance between the attempts to Namibianise our economy on the one hand, and, at the same time, maintaining our attraction to investors will continue to pose a challenge, especially for a country as young as ours, still suffering from historical injustices. This challenge lies in being able to recognise the big picture and to approach the situation with a pragmatic and open attitude in the interests of continued development and increased economic growth in Namibia," Koep said.
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