Tunisia hopes for state-owned IPOs to attract investors

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The Head of Tunis Stock Exchange, Bilel Sahnoun said Tunisia’s stock index is up an impressive 20 percent in 2018, but is being held back by the fact that the biggest firms are state-owned and unable to attract private investment.

With a market capitalisation of just $10 billion, the Tunis Stock Exchange is one of the smallest in North Africa, but it was the region’s best performer in the first nine months of 2018. Sahnoun noted that the growth had been driven by reforms such as “parity between local and foreign investors and a strong IT management system”.

The stock exchange currently has 81 listed small and medium sized companies, but accounts for only 10 percent of investments in the domestic economy. Sahnoun revealed that “between three and five other companies will be listed in textile and real estate next year, which will raise the number of listed companies to about 85-86 compared to less than 50 in 2011”.

Sahnoun hopes that privatisation would accelerate the growth of the stock exchange within five years. He said “the Tunis stock market is not on the radar of some big investors because it…does not include large companies able to attract those who can create investment and help to promote economic growth and wealth creation”.

The path to securing listings of this nature might be a rocky one. Although Prime Minister Youssef Chahed is committed to reforming the large state sector, the Tunisian General Labour Union has threatened to go on strike if privatisation of firms lead to loss of jobs.

Sahnoun, who still has high hopes for the growth of the Tunis bourse, said “listing shares in major state companies such as Tunisie Telecom, Tobacco company (Régie Nationale des Tabacs et des Allumettes) or AGIL (the fuel distributor Société Nationale de Distribution des Pétroles) would be very beneficial to the health of these companies, the economic recovery and the image of the stock market”.



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