The prevailing economic challenges have been cited as the major reason the stock market is not registering growth despite amendment on some requirements for companies to be listed on the market.

Among others, listing requirements for the market now include 400 million kwacha in capital from previous MK500 million, and a proof of profits for two consecutive years.

Malawi Stock Exchange -MSE, Chief Operating Officer Kelline Kanyangala, told Zodiak that companies are not listing on the stock market, fearing investors will shun their stocks due to higher prices.

"We did anticipate that with the reviewed list of requirements, it would have been easier for companies to come on the market, but you have seen the way developments, with current macro-econonic challenges makes it difficult and challenging for some markets to come on the market," she said.

Kanyangala added, "one of the things that companies will consider when coming into the market of the shares, they normally look at the issue of market valuation, and normally, if a company is not performing well, the pricing will also be impacted.

However, she expressed optimism that the situation will improve, hinting that they are in talks with authorities to introduce policy initiatives like tax incentives to new players on the market to attract new companies.

"If a new company comes on the market, they should be given maybe a three year reduced corporate tax window, we have seen that this works like in Tanzania and Mauritius and in the long-term it benefits the government and the economy," she  said.

Meanwhile, Economist Abel Mwenibanda, is of the view that robust civic education on financial literacy would help improve the situation, arguing that most Malawians are not acquainted with how the market operates.

"Even if the economy improve, very few may get involved both on the general public and companies because the stock market is all about perception, so there is a need for more awareness on financial literacy," he said.

Currently, sixteen companies are listed on the Malawi Stock Exchange, a market that started equity trading in 1996.

(Written by: Kenphord Mdima)