Harsha says new Govt. keen to ensure more people invest in well regulated stock market

Policy Planning and Economic Affairs Deputy Minister, Dr. Harsha de Silva yesterday declared that the new Government was keen to ensure that more people invested and benefited from a well regulated stock market.

He made this observation in his remarks at a ceremony where the Special Envoy (Ministerial Rank) to India and South Asia on Infrastructure, Prime Minister’s Department, Government of Malaysia Dato’ Seri Utama S. Samy Vellu rang the ceremonial opening bell of the Colombo Stock Exchange at the start of trading yesterday.

It was also Dr. de Silva’s first official visit since assuming duties as Deputy Minister.

Given the presence of the Malaysian official, Dr. de Silva said stock trading in Sri Lanka has a longer history than Malaysia but the latter’s market capitalisation was far higher at $ 200 billion than Colombo’s, estimated at $ 27 billion. In that context he said Sri Lanka has lot to learn from Malaysia’s tremendous success story.

“So the challenges we face are enormous. The CSE must ensure that the market grows, get more companies listed and more people investing. On the other the SEC will have to ensure the market is free of manipulation and interference and that wrong doers are punished and create an environment that people want to participate in equity market so that they have an equal chance of making or losing money,” Dr. de Silva said.

“We as a government want to create a country where we have a large middle class that owns shares – we hope to create an asset-owning middle-class. We want people in the peripheries, the rural areas, to be able to trade in high value stocks as well and we want people to trade in corporate debt. Our objective is to broad base the activity of the Exchange, not just to Colombo but to the rural areas,” Dr. de Silva said.

“The Government is committed to creating a highly competitive social-market-economy, this economy will be built on two pillars – firstly competition and secondly justice. When we say justice we mean economic, political and social justice,” Deputy Minister added.

He also said the private sector would be supported to grow and make the market more dynamic with a higher number of corporates tapping the capital market and expanding the current “plain vanilla market” to a more advanced one with new instruments. “This will ensure that not just Colombo-based corporates but even the rural farmer benefits from the capital market,” Dr. de Silva added.

SEC Chairman Thilak Karunaratne, in his address on his first official visit to the CSE, noted that as a regulator he should not be overly engaged with the promoters of capital market.

However, he said: “Our common objective is to see a well regulated capital market where all the investors get a fair deal. We are now working on improving any weak areas and perhaps bringing in more amendments to our act, which will give us more strength and teeth to correct any shortcomings, in the capital market and hope to work closely with the Colombo Stock Exchange,” SEC Chief Karunaratne said.

“We have a close relationship with the Malaysian capital market and we look forward to doing more with them, especially in terms of technology transfers with Bursa Malaysia. Currently our team of consultants on the Central Counter Party (CCP) system being developed includes experts who were instrumental in the development of the CCP system at Bursa Malaysia,” CSE Chairman Kulatilaka said.

More at:
http://www.ft.lk/2015/02/27/harsha-says-new-govt-keen-to-ensure-more-people-invest-in-well-regulated-stock-market/

Thanks FG