Some market players have opinion that even though the Ghana stock exchange (GSE) is now the 3rd largest stock exchange in sub-Sahara African after South Africa and Nigeria, this would not necessarily translate into vibrant market activity until more Small and Medium Scale Enterprises (SME) are encouraged to list on the exchange.
The GSE attained the feat after the recent official listings of Tullow Oil PLC on the exchange which has more than doubled the market capitalization from the little over 20 billion cedis to almost 49 billion cedis.
Some market players say even though good news for the market; this would hardly have any significant impact on market activity until some more SME listing.
One of such is the Executive Chairman of Databank Group, Ken Ofori-Atta who makes his argument by making a comparison with the debate about inflation rate decline and its impact on the ordinary citizens.
He comments that that the new status of the Ghana Stock Exchange may look good on paper but may necessarily not apply practically.
“This is almost like the issue of inflation; everybody says inflation which makes all of us happy but the components that deal with a lot of people is high so then they are not too happy".
"It’s the same with stock exchange, if you look at Tullow and AngloGold, it might end up 60% of the market capital so there is not much change but it gives us bragging rights to say that this is our market cup”.
The Databank boss suggested that the key way forward was to support indigenous Ghanaian SMEs to get listed because that would give the exchange some vibrancy.
He added that a combination of the new pension fund and more aggression from financial institutions in getting the indigenous companies listed would make the real difference.
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