The Mongolian Parliament passed a securities law that removes a ban on trading of foreign shares, paving the way for local listings by overseas companies.
The new law was passed today by a vote of 36 to 12, Cabinet Secretary Chimed Saikhanbileg said in a mobile-phone text message. It will take effect on Jan. 1.
More than three dozen companies with Mongolian assets are now traded abroad. The new law will encourage those companies and others to list on the Mongolian Stock Exchange and could boost the value of shares traded on the bourse by $30 billion to $40 billion in five years, Khangai Altai, the exchange’s chief executive officer, said by e-mail today.
Mongolia’s benchmark MSE Top 20 Index (MSETOP) surged 140 percent in 2010. It rose another 42 percent in 2011 before tumbling 19 percent last year. This year it’s declined 22 percent.
Only about 30 percent of the shares on the exchange are actively traded, Altai said.
To contact the reporter on this story: Michael Kohn in Ulaanbaatar at firstname.lastname@example.org
To contact the editor responsible for this story: John Liu at email@example.com