EGX Chairman, Ahmed El Sheikh
CAIRO - 20 December 2023: The Egyptian Stock Exchange (EGX) is currently working on updating and enhancing trading mechanisms, diversifying financial instruments, and simplifying registration procedures. According to the Chairman of the Exchange, Ahmed El Sheikh, there is an ongoing societal dialogue with the exchange's member entities.
El Sheikh explained, Wednesday, during his speech at the fifth annual conference of Hapi newspaper, that the stock exchange is working on introducing new financial instruments that meet the needs of traders and risk tolerance levels to increase market depth and maximize returns. Among these are Sharia-compliant indices, financial derivatives, carbon certificates, and real estate shares.
To support the transition to the use of financial technology, Sheikh stated that the exchange has established the Innovation and Regulatory Laboratory "CORBEH," and it is currently coordinating with the Egyptian Financial Regulatory Authority to host the regulatory lab for the authority within the CORBEH premises. The stock exchange is also working on further transitioning towards enhancing the use of digital technology to develop the exchange's systems and procedures.
El Sheikh presented a practical and implementable proposal, suggesting the establishment of companies focusing on creating integrated agricultural and industrial complexes. As an example, he proposed a project in a governorate with suitable natural conditions and developmental project needs, such as New Valley, which would be based on cultivating a large area with palm trees.
He added, "Complementary and associated industries with date production, such as paper, cardboard, and packaging materials, are established in preparation for selling products locally and also for export to foreign markets."
He emphasized the possibility of benefiting from the stock exchange as a financing platform, according to registration rules that allow public offering companies to be listed and traded on the exchange immediately upon establishment. This would enable a joint-stock company to be established through public offering, allowing it to obtain more financing through the stock exchange and then expand its projects.
El Sheikh stated that the stock exchange allows companies to obtain various types of financing to help them expand, raise growth rates, and increase their ability to efficiently employ human or material capital. This can be achieved through issuing new shares, ordinary bonds, convertible bonds, or various types of sukuk.
He said that the Egyptian economy has a significant relative advantage and a clear attraction element, manifested in its sectoral diversity at both the main and sub-levels. This diversity is reflected in the listed companies on the stock exchange, which diversify noticeably sectorally, with 18 sectors within the market, ranging from agricultural and industrial to services and basic resources."
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