Asia’s Newest Stock Market Is Risk to Investors, Sam Rainsy Says
Investors in Cambodia, tied with Yemen as the world’s 164th-cleanest country for doing business, face risks in a planned stock market because of ineffective financial and legal systems, the country’s exiled opposition leader said. “Among the little dragons of Southeast Asia, Cambodia is the least encouraging,” Sam Rainsy, 62, a former fund manager with Banque Paribas and ex-Cambodian finance minister, said in an interview in Paris. “The country needs a much longer period of preparation in terms of company accounts and corporate governance. Investors risk paying for nothing.” Cambodia’s stock exchange may open as early as April, listing a state-run port, telecommunications operator, and manager of the capital’s water system, according to partner Korea Exchange Inc. Developing a capital market may lessen reliance on aid, equivalent to a tenth of the nation’s $11 billion economy, and the government says it has delayed starting the bourse until conditions are right. “Frontier markets need not be perfect democracies to be lucrative investments,” said Douglas Clayton, chief executive officer of Leopard Capital, whose $34 million Leopard Cambodia Fund invests in closely held companies. “China and Vietnam are one-party states but at certain times those countries have been very good places to invest.” David Whitehouse
