Started in 1998, the Dar Es Salaam Stock Exchange (DSE) is one of investment options available for both citizens and foreigners in Tanzania. However, foreigners are only allowed to invest up to 60% in aggregate of the shares in a company. At DSE, you can buy and sell financial assets such as bonds and stocks.
Investing in Tanzania
- According to the Investment Safety Rankings, Tanzania is ranked 127 out of 192 countries.
- It is slightly above average when compared to the rest of Africa.
Who Can Invest on DSE?
Both Tanzanian citizens and foreigners can buy shares on the Dar Es Salaam Stock Exchange. However, foreigners can only buy shares of companies whose foreign ownership percentage does not exceed 60%.
What Financial Instruments Can Traders Buy and Sell?
Traders on the stock exchange can buy and sell shares of stocks, corporate and government bonds.
How to Invest in Dar Es Salaam Stock Exchange
First, investors who are interested in buying stocks in Tanzania need to open an account with one of the Dar Es Salaam Stock Exhange brokers.
1. Complete the CDS Account Opening Form
Your broker will give you an application form. Once it is filled out, you will get Central Deposit System (CDS) account number. All your trading will be recorded using this number.
2. Complete the Broker’s Account Opening Form
You will need to fill out KYC form that requires personal details such as ID number, address, preference for collection of dividends and payment of fees. You will also need to submit copy of your passport or driver’s license.
For corporate/company, you will need the following:
- A copy of Certificate of Incorporation
- Copies of Company’s Directors IDs
- A copy of Memorandum and Articles of Association
- Depository Account application form for corporate body
3. Wire Funds to Your Brokerage Account
You need to transfer funds for trading to your broker’s account. You can do this through a wire transfer or any other convenient money transfer method.
4. Submit a Trade Order
You then need to communicate with your brokers specifying the shares you want to buy.
DSE Notable Listed Companies
- Tanzania Breweries (TBL): the largest company on the DSE by market cap and the main alcoholic and non-alcoholic beverage producer/distributor in Tanzania
- East African Breweries (EABL): the second largest company on the DSE by market cap
- Acacia (ACA): one of the largest gold producers in the country
- Tanzania Cigarette Company (TCC): the largest tobacco company in Tanzania
- Vodacom (VODA): the largest telecom company in Tanzania
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Final Thoughts on How to Invest in Dar Es Salaam Stock Exchange
DSE is a member of the African Stock Exchanges Association and the World Federation of Exchanges (WFE). Being part of the East African Community, the DSE, the Nairobi Securities Exchange and the Uganda Securities Exchange will ultimately form a single East African stock exchange.
To invest in DSE, you are advised to conduct due diligence, set long term goals and diversify your investments to minimise risks.