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IFC LAUNCHES NEW STOCK INDEXES FOR SOUTH AFRICA


Iyad Malas
(202) 473-9112


WASHINGTON, D.C., Nov. 11 -- The International Finance Corporation's (IFC) Emerging Markets Data Base launched new stock indexes for South Africa today increasing its coverage of emerging stock markets to twenty-six. The addition of South Africa brings the number of securities in the emerging markets tracked by IFC up to approximately 1,450. The new indexes for South Africa, developed in cooperation with Simpson McKie Inc., have base period value of 100 on December 31, 1992. As with IFC's other emerging markets indexes, the new indexes are market capitalization weighted and available in IFC Global (IFCG) and IFC Investable (IFCI) versions, allowing researchers to measure returns to both local and foreign-based investors. The IFCG price index for South Africa has climbed 27.4% in dollar terms during 1994 (as of October 28), while South Africa's IFCI price index has gained 26.8%. The IFCG South Africa Index is composed of 63 stocks with a market capitalization of approximately $139 billion, or 62% of the Johann
esburg Stock Exchange's total market capitalization and more than 70% of the exchanges's total trading in 1994. The 59-stock IFCI South Africa Index has a market capitalization of $133 billion. The Johannesburg Stock Exchange's overall index has increased 20.6% this year, positioning the South African market in the top ten best performing emerging markets so far in 1994. As is common with the addition of new index markets, IFC will calculate a stand-alone index for South Africa until end-March 1995, when South Africa will be added to the composite and regional indexes. However, because of the large size of the South African market, IFC will calculate composite indexes with and without South African stocks to run concurrently through end-1995. According to Iyad Malas, manager of IFC's Emerging Markets Data Base, "If the IFC South Africa indexes were added to the IFC Composite indexes today, they would constitute about 11% of the IFCG Composite Index's market capitalization and 21% of the IFCI Composite Index.
This represents extraordinarily large additions to the Composite indexes, and for this reason we want to provide users of the IFC indexes with a view on the performance of the emerging markets both with and without South Africa, at least for a year or so." (More) Press Release No. 95/50, page 2 of 2 South Africa, with a per capita GNP of $2,670 as of end-1992, qualifies as an emerging market according to the World Bank's classification of a developing country ($8,350 or less GNP per capita). The South African stock market is the world's largest emerging stock market with a total capitalization of about $218 billion. IFC's Emerging Markets Data Base is the world's leading source of data on emerging stock markets and serves as a vital statistical resource for the international financial community. IFC, a member of the World Bank Group, is the largest multilateral source of direct loan and equity financing for private sector projects in developing countries.