Botswana to list Satrix 40, NewGold ETFs

By Wanetsha Mosinyi

GABORONE (Reuters) - The Botswana Stock Exchange (BSE) aims to boost liquidity by offering its investors the chance to trade a secondary listing of South Africa's JSE Satrix 40 ETF index from the first quarter of 2010.

BSE Product Development Manager Thapelo Tsheole told Reuters on Tuesday the bourse operator hoped the listing would lead to the creation of Exchange Traded Funds (ETF) based on local shares.

"We want local investors to understand ETFs so as to structure more of such products," he said.

With a market capitalisation of $4.5 billion, the 20-year-old bourse in the world's biggest diamond producer has been hamstrung by low liquidity, largely because it has few listed companies and their shares tend to be held for the long term by domestic institutional investors.

Satrix 40 will offer Botswanan investors a platform to invest in a single security representing the top 40 firms on the Johannesburg exchange.

Tsheole said the BSE also planned to list Absa Capital's NewGold ETF, which invests directly in gold and is the largest of its kind in South Africa.

"All issues of settlement, trading, movement of gold, storage have been sorted, and we are expecting a listing application from Absa Capital before the end of November 2009," Tsheole said.

Absa Capital, the investment banking arm of South Africa's Absa Group, told Reuters in October it planned a secondary listing of NewGold in Botswana in early 2010.

The BSE has been trying to automate its trading system to increase its appeal to foreign investors. Tsheole said the system was expected to be up and running in 2010.