Colombia’s stock exchange is gearing to list its first foreign firm in the coming weeks as it prepares to further open its market to international investors.
Canadian oil and gas producer Pacific Rubiales Energy Corp will be listed “in the coming weeks,” said Juan Pablo Cordoba, president of Colombia’s Stock Exchange BVC.CN.
Toronto-based Pacific Rubiales produces 100,000 barrels per day in Colombia at a field operated with state oil company Ecopetrol and is enjoying a mini-boom in oil investment.
Cordoba said he is working with regulators to simplify investment rules for local investors in foreign securities and to give more possibilities for foreign portfolio investors.
“We want to adopt international standards, make ourselves visible and make products that are interesting to all types of investors,” Cordoba said at an event organized by the Colombian American Association. “We want to make it easier to come to Colombia.”
As part of that strategy, the exchange has adopted the Nasdaq-OMX technology with international standards for both equity and derivative markets.
Cordoba said he is working on an integration of the stock exchanges with Peru and Chile, which would lift investment in each of the markets and encourage more cross-border trading.
“We are all growing but we are still very small. If you have an endogenous growth it will take forever to become much larger,” Cordoba said.
“The idea of joining forces with other exchanges of similar size is to immediately raise the profile of the markets, companies listed and exchanges. That should take 12 to 18 months.”
The Colombian market is heavy in energy and banking, the Peruvian bourse is dominated by mining sector stocks, while the Chilean market rides on energy, trade and service sectors.
Cordoba also announced it was launching an exchange traded fund (ETF) with global distribution in the first quarter of 2010.
ETFs are similar to index-tracking mutual funds but trade in real-time on exchanges with constantly changing prices, instead of being priced once a day when the markets close.
Cordoba said the exchange was joining forces with an affiliate of Colombian electricity firm ISA to create a commodities derivative market by early 2010.
He also said it would introduce in January securities lending to enhance the integrity of the market.
He reiterated that there are no capital gains tax on Colombia’s equity market for foreign investors and that there are no restrictions entering or exiting the market.