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Transparency, sound corporate governance, capacity-building of the investors and greater financial market liberalisation are some of the factors that influence flow of investment in the capital market.
These factors, when ensured, can help develop a positive mindset among the people to invest more in the capital market.
Speakers at the business session titled, "Country Experiences, Privatisation and Investment" expressed this view.
The session was part of a two-day ICC Regional Seminar on the "Capital Market Development: Asian Experiences" held at a city hotel Tuesday. It was chaired by Country Director of the Asian Development Bank (ADB) Hua Du where some renowned capital market experts from the region attended and shared their respective country experiences.
"Corporate governance is the check box, it is a philosophy and an ethical framework which can establish corporate value among the investors to give premiums to the buyers," said Managing Director and Chief Executive Officer (CEO) of the Bombay Stock Exchange Limited Rajnikant Patel.
The central government of India has started some awareness programmes among the potential investors to lure them into the capital markets, Patel said adding that they tried to attract the investors by communicating through the regional languages.
The Pakistan government has gained a huge success through the privatisation of the loss-incurring sate-owned enterprises (SOEs), said Muhammad Arif Mian, executive director of the Securities and Market Division of the Securities and Exchange Commission of Pakistan.
Citing ADB statistics, he said the combined direct and indirect losses incurred by some SOEs between 1996 and 2002 exceeded Rs 600 billion.
After this, the Pakistan government took some initiatives and offloaded shares in the capital market of some SOEs like the Muslim Commercial Bank of Pakistan, which is now running successfully, Mian said while sharing his country's experience on 'privatisation of public sector enterprises through capital market'.
He said the Pakistan government privatised the Pakistan Telecom recently, which also registered a success.
A separate board in the Stock Exchange of Thailand (SET) has been set up to attract the foreign investors, said Senior Vice-president of the SET Sethaput Suthiwart-narueput.
He said the strengthening of the privatisation of the Thai loss-making SOEs has also attracted the foreign investors.
The Singapore government has also taken some active initiatives to bring greater dynamism in the capital markets and this is the sixth important global stock market now, said President of the Singapore Exchange Limited Swee Tian ANG.
During the question and answer session, Chairman of the Securities and Exchange Commission (SEC) of Bangladesh Mirza Azizul Islam said the SEC has taken some initiatives in collaboration with the ADB to make the country's bourses more dynamic.
He said some concrete decisions have already been taken to bring some public enterprises, including the Jamuna Multipurpose Bridge, in the capital market very soon.
De-listing of any errant company is not rewarding to them, he said replying to a question. Very tough actions against the de-listed companies have been sought from the Registrar of the Joint Stock Companies and Firms as it has adequate power in this connection.
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