Ibrahim Turhan, the chairman of the Istanbul Stock Exchange, says the operation of the Tirana stock exchange and its integration into the regional capital market would promote Albania’s economic growth
TIRANA, Sept. 24 – Almost a decade after its establishment, the Tirana stock exchange remains inactive due to the small number of listed companies currently counted on the fingers of one hand and lack of interest because of the high informality of Albanian businesses. However, at a time when the banking system has almost frozen lending, experts consider the activation of the Tirana stock exchange another opportunity to increase efficient investments. Speaking in an international forum on the capital market held in Tirana this week, business representatives said the activation of the capital market is the best way to fight corruption in privatization processes and attracting necessary financing for projects and public companies affecting the state budget.
“The increasing need of the Albanian businesses to find new financing ways, different from the costly bank loans, naturally leads to the activation of the capital market, which is necessary also to ensure financing on public companies and projects. The listing of public or private companies in the stock exchange would also serve to increase the confidence of these enterprises and would be the best way of marketing for potential investors in Albania and abroad,” said Gjergj Buxhuku, the administrator of the Konfindustria business association.
The activation of the capital market would not only break the financial monopoly commercial banks have established but would also give households the opportunity to invest their savings in shares of public projects or strategic enterprises.
Ibrahim Turhan, the chairman of the Istanbul Stock Exchange, said the operation of the Tirana stock exchange and its integration into the regional capital market would promote Albania’s economic growth.
“Through its integration, the Tirana Stock Exchange and the listed companies can attract foreign investors and address the liquidity issue. This will push more companies to be listed and the stock exchanges will become instruments of the delivery of capital in enterprises which is the main reason of their existence. Eventually, this would accelerate the economic growth for the whole region,” said Turhan.
The Tirana Stock Exchange, TSE, established in 2002 in the form of joint stock company is the only organized securities market in Albania.
The Tirana Stock Exchange is the only market operator that has adopted internal rules concerning membership and listing, but remains inactive. As a result the Albanian financial system is currently centred on banks. Since January 2008, financial reporting of listed companies needs to be in line with International Financial Standards (IFRS) but due to the inactivity of the stock exchange, the effectiveness of this provision still remains to be tested. Despite continuous efforts, this institution has not been able to be attractive enough for the national business. Currently, there are only four listed companies in the Tirana Stock Exchange, three of which are local commercial banks.
