Iraq stock exchange hopes to spark recovery (02/12/05)

After more than a year in makeshift lodgings, the Iraq Stock Exchange has celebrated its official opening. Even with the surrounding blast walls painted a matching cream, the newly built sandstone building in south-east Baghdad looks more like a neighbourhood bank or hotel than a key national financial institution.

Iraq stock exchange to improve economy

But its brokers hope the ISX will help spur the recovery of Iraq’s industrial economy. Private-sector financial mechanisms - the stock market and the undersized private banking system - will be vital to support sustainable reconstruction, US officials say.

“This is an essential institution for making the economy more dynamic and creating investment opportunities,” Saddoun Kubba, chairman of the Commercial Bank of Iraq said.

The ISX picked up the reins from the former Baghdad Stock Exchange, created to sell off state-owned industries as Saddam Hussein’s regime felt the squeeze of international sanctions. Trading on the old exchange ceased on the eve of the US-led invasion 2½ years ago.

At first, US advisers derided the old system of white boards and markers as an example of economic backwardness. But as the Americans struggled to organise a state-of-the-art electronic trading floor, Iraqi shareholders grew anxious about frozen assets, Iraqi brokers said.

Iraqi finance officials say they urged the Americans to let go of high-tech dreams and just allow the exchange to carry on with business. “It works exactly like the old stock exchange,” said Munther al-Fettal, ISX board member. “It’s clear and practical. For getting deals done, it works just fine.” Still, the volumes traded are paltry by regional or world standards.

Source: Iraq Directory