AMMAN STOCK EXCHANGE
The year 2003 for the Amman Stock Exchange
(ASE) was the year of arriving at all-time highs
since the establishment of the securities market
in 1978.
Jalil Tarif
Executive Manager
The year 2003 for
the Amman Stock
Exchange was the
year of arriving at
all-time highs since
the establishment of
the securities
market in 1978.
The performance of the ASE's indicators was
noteworthy. In December 2003, the ASE price
index reached 262.6 points, the highest since
the establishment of the market and closed at
261.5 points by the end of the year, up 54%
compared to the 2002 closing. Trading volume
almost doubled to reach US$ 2.44 billion. The
ASE's market value went up by 55% to reach
US$ 11.0 billion or 117% of the GDP, indicating
the important role the ASE plays in the national
economy.
As a recognized sign of the increasing confidence
in the ASE, the California Public Employees'
System, (CalPERS), the largest pension fund in
the United States (a shareholder in over 1,600
US companies), has approved Jordan to be on
its targeted emerging markets list. In this
context, the net foreign investment during the
year 2003 increased to US$ 116 million.
The ASE has given priority to the very important
issue of corporate governance. In this regard,
we have presented our view concerning
corporate governance locally and internationally
through our participation in several meetings
and workshops. Some of these included the
Middle East and Africa Corporate Governance
HISTORY AND DEVELOPMENT
The Amman Stock Exchange (ASE) was
established in March 1999 as a non-profit,
private institution with administrative and
financial autonomy. It is the only entity in Jordan
authorized to function as an exchange for the
trading of securities. The Exchange is governed
by a seven-member board of directors. An
executive manager oversees day-to-day
responsibilities and reports to the board. The
ASE membership is comprised of Jordan’s 33
brokerage firms.
The history of securities trading in Jordan traces
its origins back to the 1930s. In 1976, the
Amman Financial Market was established to
create a regulated trading market. More
recently, as part of Jordan’s move to upgrade
its capital market, a new Securities Law was
enacted in 1997 separating the supervisory and
legislative roles from those of exchange
operations. As a result, the Jordan Securities
Commission (JSC) was created at the same
time as the ASE and the Securities Depository
Center (SDC) were established. The JSC
supervises the issuance of and trading in
securities and monitors and regulates the
market. The SDC oversees clearing and
settlement and maintains ownership records.
Expert Meeting, held in Cairo and organized by
the International Private Enterprise Center and
the World Bank Forum for Governance. The
ASE also joined the Corporate Governance
Workshop held in Jordan.
As part of our keen efforts to strengthen ties of
cooperation with international market
institutions, we have joined the International
Organization of Securities Commissions
(IOSCO) as an affiliate member. We
participated in the first international capital
markets conference held in the Greek city of
Thessaloniki and we have taken part in many
conferences and exhibitions both worldwide
and locally.
A cooperation agreement was signed in
October between the ASE and the Thessaloniki
Stock Exchange Center. The signing of this
agreement falls within the ASE's commitment to
boosting its cooperation with regional and
international institutions for the benefit of the
ASE and the Jordan Capital Market.
To further enhance the data dissemination
policy, the ASE participated in meetings of the
SIIA and the FISD. In this regard, the ASE
started broadcasting its stock prices live on the
CNBC Arabia channel.
FUTURE OUTLOOK
To provide a transparent and efficient market,
the ASE implemented internationally recognized
directives regarding market divisions and listing
criteria. It also adopted procedures for
improving regulatory effectiveness.
On 26 March 2000 the ASE launched an
automated order-driven Electronic Trading
System. The new system is in compliance with
international standards and takes into account
the G-30 recommendations. This system also
offers brokers immediate access to stock prices
and orders and enables members to trade
remotely.
During 2004 the ASE will:
• complete the revision of its rules and
regulations in compliance with the new
Securities Law of 2002. New listing rules will
be implemented; these rules will emphasize
the financial performance and liquidity of listed
companies and provide continuous listing
requirements. The new ASE by-laws will
enhance the regulatory role of the ASE on its
members.
• launch the ASE’s new website. The website
will have a new look and theme. Innovative
features will be added to the site, including
historical trading data, a shareholding
companies guide and the ability of visitors to
customize charts. The new design of the site
will make browsing easier and the site more
user friendly.
• activate the ASE’s role in privatization and
encourage companies resulting from
privatization to bring their IPOs to market and
list their shares on the ASE.
• change the base of the price index from 100
points to 1000 points as of January 2004.
• introduce a new free float weighted price
index. The weight of any company in the new
index is limited to 10%.
• develop a new and improved data
dissemination policy.
FEDERATION OF EURO-ASIAN STOCK EXCHANGES YEARBOOK 2003/2004
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