Such a Quiet Libyan Stock Exchange
Such a Quiet Libyan Stock Exchange by Chris Stephens
The cartoon adorning the cover of the Libyan Stock Market brochure is stark: A man with a frown on his face and his pockets turned inside out explains to his horrified wife how he has been swindled by an unscrupulous broker. The message—that investors should stick with a regulated market—is being pushed hard by the fledgling stock exchange as it struggles to establish itself.
Few stock markets in the world are as out of sync with their economies as Libya’s. The country, 10 months after shaking off the dictatorship of Muammar Qaddafi, is rich: It pumps 1.55 million barrels of oil a day and is nearly up to prewar export levels. Bloomberg estimates Libya’s foreign investments are worth $168 billion, and the country has no debt. The nation’s 6 million inhabitants are hungry for new homes, cars, cell phones, public transport, and hospitals, and Libya can afford them. This all spells opportunity for banks, cement makers, construction companies, oil drillers, and other companies that could raise money on the exchange.
Yet Libya’s stock market is tiny—literally. The entire trading floor, in a shopping block in Tripoli’s Highland suburb, would fit onto a basketball court. Twelve companies, mostly banks and the exchange itself, are listed, and the total market capitalization of these stocks is $3 billion, compared with $56 billion for the Cairo exchange. Taxi drivers are unable to find it. The exchange was started in 2007 amid promised reforms, closed when last year’s revolution broke out, and reopened on March 15 of this year.