PSE backs out of Asean exchange connectivity scheme

The Philippine Stock Exchange (PSE) has shelved plans to join a multilateral electronic bourse that will allow investors from other Southeast Asian countries to buy shares in local blue chip companies.

The PSE on Friday said it still needed to drum up interest for the project, which would also allow local retail investors and brokers to buy into performing companies in neighboring countries.

“The exchange has decided to defer its participation in the Asean (Association of Southeast Asian Nations) Link, or intra-Asean connectivity platform scheduled to be launched by 2012,” the PSE said in a disclosure.

The Philippines was one of the first four countries that pledged participation in the planned trading link.  The other three were Malaysia, Singapore and Thailand. Other Asean bourses are expected to join the trading link by 2013 and 2014.

The PSE did not say when it planned to join the Asean exchange.

The project aims to connect the equity markets in Southeast Asia, giving the region’s residents more investment opportunities.

The interconnection of markets is also seen as a step toward the eventual economic integration of the culturally diverse Southeast Asian region, similar to the European Union.

The PSE said it would “undertake efforts to generate further interest and support for the project from its local brokers and the investing public.”

“The PSE looks forward to rejoining the Asean Link at a future date, and, in the meantime, will continue to keep abreast of the initiatives of the Asean Exchanges toward promoting and strengthening the Asean capital market” the PSE said.

Among these initiatives was the “Asean Stars” project, which is a list of 30 most exciting stocks in the region. Together with the PSE in the project are Malaysia’s Bursa Malaysia, Vietnam’s Hanoi and Ho Chi Minh stock exchanges, the Indonesia Stock Exchange, the Singapore Exchange and The Stock Exchange of Thailand.