Of the roughly 200 nations (both official and partially recognized) in the world, 40 of these countries have no stock exchanges. As frontier market investors with a focus on public equities, keeping an eye out on which countries are about to launch new stock exchanges is important as they usually represent promising investment opportunities. This is because stock exchanges require a great deal of capital, expertise, controls, and economic growth in order to survive, and a stock market launch is a promising sign that early economic challenges have been overcome. We could not find a definitive list of countries with no stock exchanges online, so we have compiled our own.
Here is a list of countries without stock exchanges (population over 1 million):
|Angola||Sub-Saharan Africa||$ 6,247||19,183,590|
|Democratic Republic of Congo||Sub-Saharan Africa||$ 1,287||69,360,000|
|Eritrea||Sub-Saharan Africa||$ 707||6,536,000|
|Ethiopia||Sub-Saharan Africa||$ 1,366||87,952,991|
|Gambia||Sub-Saharan Africa||$ 1,962||1,882,450|
|Guinea||Sub-Saharan Africa||$ 1,125||10,628,972|
|Kosovo||South Europe||$ 7,766||1,815,606|
|Lesotho||Sub-Saharan Africa||$ 2,255||2,098,000|
|Liberia||Sub-Saharan Africa||$ 703||4,397,000|
|Madagascar||Sub-Saharan Africa||$ 970||21,263,403|
|Mauritania||Sub-Saharan Africa||$ 2,218||3,461,041|
|North Korea||Asia-Pacific||$ 1,800||25,027,000|
|Somalia||Sub-Saharan Africa||$ 600||10,806,000|
|South Sudan||Sub-Saharan Africa||$ 1,350||11,739,000|
|Tajikistan||Central Asia||$ 2,354||8,160,000|
|Turkmenistan||Central Asia||$ 9,510||5,307,000|
|Yemen||Middle East / North Africa||$ 2,316||25,235,000|
GDP per capita is on a PPP basis and is as of 2013 from the IMF.
There are also 20 countries with a population under 1 million that do not have stock exchanges: Andorra, Belize, Brunei, Comoros, Djibouti, Kiribati, Macau, Marshall Islands, Micronesia, Monaco, Nauru, Palau, Samoa, San Marino, Sao Tome and Principe, Solomon Islands, Tonga, Tuvalu, Vanuatu, and Vatican City.
Notable Countries With No Stock Exchanges:
With a population of almost 90 million, Ethiopia is the biggest country in the world without a stock exchange. On the other hand, it is home to Africa’s first commodity exchange, the Ethiopia Commodity Exchange (ECX), which began operations in 2008. The ECX was founded by economist Eleni Gabre-Madhin (read an interview with her here) and trades five commodities: coffee, sesame, haricot beans, maize, and wheat. While the National Bank of Ethiopia has done studies on the feasibility of a future stock exchange, nothing is planned yet.
Burma / Myanmar
While Burma currently has the Myanmar Securities Exchange Centre (MSEC), an exchange founded back in 1996, it had little IPO activity after it’s opening and is effectively dead. Fortunately, the government has enlisted Daiwa Securities Group and the Tokyo Stock Exchange to help them start a new exchange: the Yangon Stock Exchange (YSE). From the latest reports, it is currently slated to open in October 2015 with six companies interested in listing.
Angola has a sizable population and is one of the more developed countries on this list, so it is a surprise they lack a stock exchange given the number of smaller and less developed countries in Africa with exchanges of their own. Unfortunately, while an exchange has been discussed since 2002, the launch of the Angola Stock Exchange has been pushed back again to 2017. The culprit is poor financial statements, and it will take time for expertise and infrastructure to be in place.
These 40 countries represent the final frontier for investors, and we certainly expect the top 20 countries on this list to have stock exchanges one day. The biggest reason for the larger countries to not have stock exchanges is rule of law and prevalent corruption. This means that until their rankings improve on Transparency International’s reports and others like it, stock exchange launches will continue to be delayed.