Market capitalization represents less than 0.5% of GDP in 2021, Cosob notes. These figures provide information on the insignificant contribution of the Algiers Stock Exchange to financing the economy.
LThe total market capitalization of the Algiers stock exchange amounted to 45.640 billion dinars as of December 31, 2021, indicates the Commission for the organization and supervision of stock exchange operations (Cosob) in its annual report 2021.
Compared to the same period in 2020, the Algiers stock exchange gained 6.43% of its capitalization in 2021, after losing 10% between July 2019 and December 2020. This improvement, specifies the stock exchange gendarme, “is justified by the resumed activity of listed companies and pressure on demand for securities on two securities in particular, Biopharm spa and Alliance Assurances spa “.
Market capitalization represents less than 0.5% of GDP in 2021, Cosob notes. “These data provide insights into the insignificant contribution of the Algiers Stock Exchange to the financing of the economy,” the report emphasizes. The total volume of exchanges on the stock exchange in 2021 is approximately 244,399 shares compared to 87,796 shares in 2020, or a growth of + 178.37%. The exchanges in value amounted to 127,907,601 DA against 78,458,464 DA in 2020, with an increase of + 63%.
The resumption of activity in 2021 did not cover the losses recorded during 2020 due to the pandemic, as the level of activity was divided by 3 for the exchanges in value and by 2.84 for the volume of exchanges.
Furthermore, the liquidity on the market which represents the quotient of the ratio of the total volume of trading in relation to the floating capital is only about 2.41% (characteristic of an illiquid market). This situation is mainly linked to the recurrent weakness of the Algiers stock exchange.
The document indicates the small number of transactions on the market, which testifies to the weakness of the Algiers Stock Exchange and the lack of enthusiasm it arouses among public and private operators. The report also notes that recourse to the financial market remains limited compared to other financing methods (state budget, banks, etc.), thus depriving companies of significant and diversified sources of financing.
The Cosob refers to the development of a series of proposals that “constitute an important lever for the relaunch and development of the financial market which can also, in its transversal dimension, contribute significantly to the diversification, competitiveness and transparency of the economy”.
The proposals focus on five areas. This involves the development of regulation at the service of market dynamics, the contribution to the financing of the economy through an attractive financial center, the strengthening of transparency and investor confidence, the implementation of a policy to attract FDI through the stock exchange. Algiers and to actively participate in innovation and start-up financing.
By developing these proposals for action, Cosob, the financial market regulator, aims to make the financial market play its primary role: to be an important lever for the financing of the economy and to be at the center of structural reforms, enabling the emergence of a competitive transparent and modern economy market.
“The financial market must be seen as an accelerator of structural reforms in the economy and a catalyst for instilling good governance, transparency and compliance among all market players,” said Abdelhakim Berrah, president of Cosob. It should be noted that Mr. Berrah is currently no longer president of Cosob.
A presidential decree dated January 31, 2022 was published in the Official Gazette n ° 10 which puts an end to the functions of chairman of the commission for the organization and supervision of stock exchange operations exercised by Mr. Berrah. “The Regulatory Authority has put in place innovative financial instruments that meet funding needs such as crowdfunding, sharia-compliant equity securities, collective investment schemes and many others,” said Cosob’s chairman.
For the latter, the conditions for success are met for the emergence of a financial market worthy of our country. It is up to all actors, insurers, bankers, private equity firms and others, to take it.
The Cosob report states that “together with the investigations launched by the national judicial authority on money laundering and corruption, Cosob has received over 80 requests for investigation relating to assets held by more than 300 allegedly”.
Cosob, through the central register of shareholders and the information and documents sent by the account holders, custodians of securities, responded to all these requests within the established deadlines.