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Important changes are expected in Azerbaijanâ€™s securities market

17 May 2011 09:23 (UTC +04:00)

According to APA-Economics, the program covers to improve the securities market on the basis of organizational, technical and capital demands, provide the function of quick and useful capital market institutions, extend the trade opportunities of stock exchange, automatize the trade system, improve the depositary-accounting system, including securities and registration mechanisms of rights on them.

At the same time, itâ€™s planned to establish centralized clearing system on securities trade for increase of effectiveness and decrease of risks and provide the integration to its e-payment systems.

Besides, organization and promotion of the activity of financial intermediation and collective investment schemes have been paid attention. Important legal and organizational mechanisms for formation of investment companies, assets management companies and custodian institutions will be formed within the measures in the document. Financial intermediaries will promote the activity on implementation of broker, dealer, investment analyse, underwriting and other functions, complexly.

Program reports that, itâ€™s required to increase the trade in stock exchange for effective operation of securities market and establish effectiveness atmosphere for it, extend the use of current capital market instruments, promote issuance of new financial instruments. Formation of modern capital market is related to providence of liquid and deep market of government bonds. Itâ€™s planned to coordinate the relevant state bodies, use monetary and fiscal instruments optimally, including implement important measures for providence liquidity of government securities.

For the purpose of extending the trade in securities market, it is considered to offer securities of several state-owned enterprises ready for financing from securities market and to establish relevant legal and organizing mechanisms in this regard. Moreover, showing of state financial support to private sector by stock market tools, giving preference to companies quoted in stock market and determination of output value of investments by capital market tools will be realized as well.

For the purpose of increasing financing opportunities of small and medium entrepreneurship from capital market, alternative trade platform is considered to establish at Baku Stock Exchange. Besides, for the purpose of increasing range of investment instruments presented in stock exchange and providence of private investorsâ€™ interest to the market, it is planned to carry out appropriate legal and organizational measures in local market, as well as in foreign capital markets.

For extending the offer of financial instruments having high competitiveness in securities market, increasing the interest of foreign investors to Azerbaijanâ€™s securities market, it is considered to apply the financing practice of infrastructure projects with stock market tools, to establish trade mechanisms of different debt securities and term contracts. Existence of favorable tax environment assumes great importance for effective activity of capital markets, financing of private sector and extending of investment opportunities. Taking it into account, improvement of terms of taxation in securities market on the basis of international practice, as well as application of tax credits to investment incomes got from securities, incomes got from purchase of securities will be on the agenda. Moreover, it is considered to establish appropriate fiscal regime propagandizing the activity of mutual funds.

Remind that, â€œDevelopment of securities market in the Republic of Azerbaijan in 2011-2020â€ State Program was confirmed by Azerbaijani President on May 16.