By Frank Kamuntu
The government of Uganda has ordered telecom operators in the country to list on the local’s security exchange (bourse), part of a move to encourage local ownership of the sector, the Uganda Communications Commission said on Wednesday.
The country’s operators, which are nearly all foreign-owned, have been given two years to list at least 20% of their shares.
Firms include a local unit of South Africa’s telecom giant MTN Group and a subsidiary of India’s Bharti Airtel
President Yoweri Museveni said the move could conserve the country’s scarce foreign exchange as a portion of the firms’ dividend payouts would remain in the country.
Ibrahim Bbosa, spokesman for the regulator Uganda Communications Commission (UCC), said they are now using a new licensing policy and existing operators would be issued with fresh licences with new conditions.
“Within 60 days we want to have issued new licenses and then two years from then all the players should have listed at least 20% of their shares on the Uganda Stock Exchange (USE),” he said.
Uganda is the latest East African country seeking listing of foreign companies through legislation, after Kenya and Tanzania.
The Uganda Securities Exchange (USE) is the principal stock exchange of Uganda. It was founded in June 1997. The USE is operated under the jurisdiction of Uganda’s Capital Markets Authority, which in turn reports to the Bank of Uganda, Uganda’s central bank.
The exchange opened to trading in January 1998. At that time, the exchange had just one listing, a bond issued by the East African Development Bank. Trading was limited to only a handful of trades per week.
As of July 2014, the USE traded 16 listed local and East African companies and had started the trading of fixed income instruments and the Exchange is a member of the African Stock Exchanges Association.
The USE operates in close association with the Dar-es- Salaam Stock Exchange in Tanzania, the Rwanda Stock Exchange, and the Nairobi Stock Exchange in Kenya. According to published reports in 2013, there were plans to integrate the four exchanges to form a single East African bourse, although that is yet to materialise.