MARKET DATA REVIEW: Parastatals can raise funds through bourses

>Privatisation is the process of transferring ownership of a business, enterprise, agency, public service, or public property from the public sector (a government) to the private sector.

There are two major encouraging statements that came to our attention recently, these statements came from the government: (i) the possibility of repossession of previously privatised state owned entities that were sold to some investors; and (ii) state owned entities, agencies and parastatals are now required to refocus on becoming more efficient and raise their financial needs from the local financial market.

It is fairly expected that, we as humans in our own ways should always be in the process of creating a good society — a society where citizens are largely satisfied, one where people are happy and thrive in their undertaking. A good society is one that values decency, responsibility, justice, tolerance and where natural human rights are observed.

>At the heart of investment, particularly investment in listed shares or any other such investable asset classes is the simple question: is the investment rational? The answer to this question might not be as crystal clear or self-evident in some cases.

>Let’s start the New Year, 2015 by going back to the basics: What does owning shares mean? What is a share? Who can issue shares, Who can invest in shares etc etc.

Demutualisation of stock exchanges has captured media headlines in recent years — it seems like most exchanges are doing it (except for Africa, for obvious reasons). A number of exchanges across the globe have demutualised since this idea came into the public attention, especially after the first incident of demutualisation by the Stockholm Stock Exchange in 1993.

>If an investor had invested similar amount of money across 14 domestic listed companies on the Dar es Salaam Stock Exchange (DSE), the annualized capital gain return would have been 4.5 per cent. As the table below indicates – share valuation for some companies have grown up above 30 per cent while a few companies have lost – these are the normal workings of the market.

Since the enactment of the Capital Markets and Securities (CMS) Act, Cap. 79 of 1994 and the establishment of the Capital Markets and Securities Authority (CMSA) in 1996, there has been several developments in the Capital markets in Tanzania.

>Back in 2010 two pieces of legislation (Mining Act of 2010 and the Electronic and Postal Communication Act of 2010) were passed by our Parliament and got signed by the president with all the optimism that these laws entailed to fulfill, including some of the dream of local citizens, especially the aspect of the requirement that companies with Special Mining Licences and those operating in the telecommunication sector will be required to offer shares to the public and subsequently list on...