The Swaziland Stock Market is a small
but thriving exchange. The share market was established in July 1990 by
Sibusiso Dlamini, a former World Bank executive who became Swaziland's prime
minister, to enable ordinary Swazis to become stakeholders in their economy.
All listings are included in the only index, the SSM Index which is unweighted.
There is a handful of listed
public companies, as well as some listed government stock options, listed
debentures, government guaranteed stock and non trading mutual funds.
Exchange Control approval is required for foreigners wishing to invest on
the stock market.
Stockbrokers on
the Exchange are licensed by the Central Bank of Swaziland and there is no
regulation regarding the foreign ownership of brokers.
Trading days and times are Monday to Friday, 10:00 to 12:00
local time, with trading occurring on a matched bargain basis. Brokers may not
take positions. There is a basic stock exchange handling fee of E20 per
transaction with brokerage fees on equities on a sliding scale from 1% to 2%:
| Transaction value |
Commission |
| E 0 - E 49 999 |
2.0 % |
| E 50 000 - E 99 999 |
1.5 % |
| E 100 000 and higher |
1.0 % |
A 15% non resident tax on dividends is levied. There is no capital gains
tax.
Fees on Government Stock range between 0.0625% and 0.5%:
| Transaction amount |
Fee |
| First E 5000 |
0.5% |
| Next E 15 000 |
0.375% |
| Next E 80 000 |
0.25% |
| Next E 150 000 |
0.125% |
| Excess over E 250 000 |
0.0625% |
For companies wishing to list on the exchange, listing fees are the higher
of E15 000 or 0.5% of the value listed. There is also a prospectus distribution
(0.5% of value of shares allotted) and placing fee (0.5% of value of shares
placed).
The main market index increased from 131.46 at the end of 1995
to 192.85 at the end of 1996. Turnover during 1996 was US$ 2.2 million on a
turnover volume of 3.3 million shares, and by the end of the year market
capitalisation was roughly US$ 471.2 million.
At the end of 1997, market capitalisation was dramatically down, at US$
110.9 million, largely as a result of the delisting of Lonrho Sugar. However,
turnover improved dramatically during the year to US$306.2 million, as a result
of a number of take-over deals.
The Exchange is expected to be given a boost by parliament's
passage of the Securities Bill, which will establish a formal market and
provide for the licensing of brokers, while an accompanying Pension Bill is
intended to jump start investment capitalisation by requiring that 15% of local
pension funds (currently invested mainly in South Africa) be invested in
Swaziland. The government is also expected to accelerate the privatisation of
parastatals which could then be listed on the stock exchange.
