The Singapore Exchange’s (SGX) US$8 billion offer for the Australian Securities Exchange (ASX), which would see the two countries’ bourses merge, has been approved by Australian Consumer and Competition Commission (ACCC). While the decision may have provoked some optimism among investors, most eyes are on the bigger hurdles to come — including approval by Australia’s parliament, which some say is a hurdle too high under current conditions.

Australia is currently governed by Prime Minister Julia Gillard’s Australian Labor Party, which does not have a majority in either the upper or lower house of parliament, and governs only with the tenuous support of a group of rural independents and the left-wing Australian Greens, many of whom have expressed some degree of opposition to the deal. The ASX is still confident, but it will need to do more than just convince people of investor benefits to overcome nationalism and populist sentiment, or somehow gain the support of both major parties to sideline the smaller ones.

Whatever the outcome, Australian investors and traders will enjoy more competition from Asia in the coming years. ASX’s monopoly is about to end, with alternatives like Chi-X Australia and Chi-East about to open shop and offer alternative access to Australian, Hong Kong, Japanese and Singaporean markets.

source & article: Reuters via Yahoo! Singapore