SA labelled emerging mkt 'unfair'
Johannesburg - Tradition, the world's third largest interdealer broker, is entering the fray in the South African marketplace, and feels South Africa offers real potential for their business, but also feels it is unfair we suffer under the weight of our emerging market status.
The company's CEO, Robin Houldsworth, says: "We are very interested in the emerging markets arena.
"However, it's a little unfair to label South Africa that way if you look at the quality of management and various other issues.
"It's unfair to be lumped into that group.
"International players often make decisions as a group - and you suffer as a result of that."
He said his company had noted benefits in the SA market and had seen an increase in their client base, which was the reason they were now entering the market in a bigger way.
He also viewed this as the first step to a potentially bigger role in Africa. "We would like to use South Africa as our gatepost into Africa.
"There are a lot of opportunities if you look at growth in Namibia, Uganda, Kenya, even Nigeria," he said.
"Your economy is pretty robust - for instance we recently had Turkey where a response comes and then your market bounces straight back. It's not totally fair to label you the same way as other emerging markets," he said.
Announcing the opening of its subsidiary in Johannesburg, he said his company had offices in 20 countries around the world and was used to being exposed to different external requirements.
He said he did not see BEE as problem at all.
"We are expanding and see this as part of the programme. We are in 20 countries and are used to having to deal with different requirements. For instance, we are also going into China and have to abide by their strict rules regarding shareholding.
"The same thing applies in Japan, where we have a presence. There are many different local rules, which is fine. We like to see ourselves as contributors and facilitators in this regard."
"We would like to be seen as supporting the local market and will fit in with the local infrastructure," he said.
The office in Johannesburg will initially cover South African government bonds and interest rate derivative products.
"If you look at your long bond for instance, rates of around 8% in SA are very interesting for international investors. We therefore see lots of opportunities here."
Forex interest rates make up 54% of the business flow for Tradition, equities and derivatives 33% and commodities and other activities 13%. The company has approximately 7 000 institutional clients.
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