JSE Conference | Disruptive listings the next JSE frontier
JSE CAPITAL MARKETS CONFERENCE
Disruptive sectors are being targeted for capital market financing as part of the economic recovery, according to speakers at the opening of the Jamaica Stock Exchange 16th annual conference.
“We are not short on innovation and we need to capitalise on them,” said JSE Group Managing Director Marlene Street Forrest. “Financing is the key to unlock their value.”
The sectors of aquaculture, renewable energy, bio-tech and sea-vegetable farming are worth some US$2.5 trillion globally, and not only are they large in scope, Street Forrest said, but they also have a positive social impact.
The JSE market valued at around $1.7 trillion currently contains only a few disruptive firms, including renewable companies Wigton Windfarm and MPC Caribbean Clean Energy, and courier company Mailpac Group.
In the US equity markets, a number of disruptive stocks, many with strong commitments to the environment, society and governance – referred to as the or ESG sector – led the market in 2020. Comparatively, the Nasdaq index gained 44 per cent while clean energy indexes rose by more than 100 per cent. As for individual disruptive stocks, electric car companies Nio and Tesla gained 1,200 per cent and 700 per cent, respectively; online conference company Zoom gained 420 per cent, while online retailers Etsy and Amazon gained 300 per cent and 80 per cent, respectively.
NCB Capital Markets CEO Steven Gooden told the conference that was streamed from the Jamaica Pegasus Hotel that there is heightened focus on alternative investments as a means of increasing returns, including private equity, mezzanine financing, and venture capital, and that alternative investments will play a critical role in small business financing, as traditional banks are not as flexible.
“It is a direction we need to embrace and nurture,” Gooden said.
The theme was also carried by Prime Minister Andrew Holness in his keynote speech at the conference, who, citing companies such as Zoom, said the pandemic has catapulted niche US companies to hold more market capitalisation than many large players in the traditional economy.
Jamaica needs to leap into the knowledge economy, he added, which will require more training in software coding at a practical and not only the academic level.
Holness also wants to see the creative sector, which he describes “an important asset” to the Jamaican economy, developing talent across a wider spectrum, while noting concern about the volume of violent lyrics in local music.
“We are not just focusing on science, technology engineering and mathematics. There is also serious work that needs to be done in our creative industries to ensure we produce works of art and music that are edifying and uplifting and of value to the society,” said Holness. “That is part of creating the economic solution to our challenges."