A leading official at the Korea Exchange, joint partner in Cambodia’s soon-to-launch bourse, believes the Kingdom’s economy and capital market have “dynamic prospects”.
Pat Gil-Soo Shin, senior vice-president of Emerging Market Development of the Korea Exchange, or KRX, also expressed hopes for Cambodia’s new stock market, but said its launch was “no easy” task.
Speaking to The Post in Seoul, he confirmed that the preparations for the much-delayed Phnom Penh exchange – set to launch in Canadia Tower in July – are gathering pace.
KRX has drawn up operational rules for the new market, which are awaiting approval from the Securities and Exchange Commission of Cambodia, while a Korean advisory group has been dispatched to Phnom Penh to design and consult on bourse framework. “SECC is working on the supervisory regulations with many crucial ones already finalised,” he said.
Information technology infrastructure, he said, was “almost finished”, with a training session set to take place in the capital.
“It is just natural to take a long time to introduce a totally new industry [the exchange] to a country,” he said. “There should be various obstacles and challenges with this complex project.
“However, we are pleased to have proceeded with the project successfully so far, via close cooperative efforts with the Cambodian government.”
The decision to hold a 45-percent stake in Cambodia’s stock exchange, he said, was part of KRX’s business plan to enter into strategic alliances with regional stock exchanges and globalise its business scope.
But launching exchanges in emerging economies brought challenges. “Every company may have its own reason to list or not,” he said. “There may be some companies that have reported less income to [the] tax authority. This was also the case in Korea. Especially in emerging countries, there may be a need to introduce temporary measures to promote companies’ IPO (initial public offerings) and listing and solve the problem of ‘by-gone tax evasions’.”
Emphasising the need for financial transparency in order to apply for listing, he said: “Some securities companies are already in talks with applicant listing companies.”
But programmes informing businesses about the potential of the exchange were planned in order to spread further exchange awareness in the business community.
Striking a balance between investor protection and market development was also a factor to consider.
“There should be balanced policy direction ... too much focus on investor protection will restrict market development in the initial stage, while we cannot compromise quality of the market,” he said.
Looking to the future, he remained enthusiastic about the Kingdom. “I see dynamic prospects within the Cambodian economy and the capital market [set] to be introduced,” he said.
(source from the Phnompenh post newspaper, Thursday, 23 December 2010 19:14 May Kunmakara)
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