Jan 2007 Financial News

Bruce Golding calls for regional stock exchange

Jan 12, 2007

Montego Bay, St James - Opposition Leader, Bruce Golding on Wednesday renewed his call for Caribbean heads of governments to fast-track the implementation of a regional stock exchange in order to effect real economic growth in the region through capital investments in the creation of new businesses.

"I am particularly disappointed at the little use that has been made of the market in raising capital for new investments rather than merely being a market for buying and selling existing stocks," he told regional representatives gathered at the Ritz Carlton Rose Hall on Wednesday, for the opening day of the 2nd annual Jamaica Stock Exchange (JSE) three-day Investments and Capital Markets Conference.
He said that at best what now existed was basically three separate markets - Jamaica, Trinidad and Barbados that talked to each other - with 11 cross-listed companies.

He stressed that serious reforms were needed to further the agenda of a single regional stock exchange. "What we have in essence are three separate markets that talk to each other," he charged. "The question to ask is how much growth can be achieved simply through cross-listing."

What was needed, he said, was a regional capital market with a standard set of rules and a homogenous regulatory framework, but he acknowledged that this was still a long way off as it would require regional governments to implement policy reforms and the acquisition of the necessary real time technological infrastructure to facilitate traders and dealers.

"It (a single stock exchange) would create a larger more dynamic framework, offer greater investments options, allow investors to diversify their portfolio, create regionally a larger pool of current and potential stock holders and greater security for the less adventurous investors."

He lamented, however, that as regional governments forged ahead toward full integration through the Caribbean Single Market and Economy (CSME) this was not at the forefront of their discussions.

Instead, he said what persisted was individual member country stock exchanges that benefited just a small number of investors making very high returns, but making limited contribution to the economy in relation to the creation of new businesses and the spreading of shareholdings.

He also raised the question of the progress of the JSE in implementing a junior stock exchange to facilitate smaller companies, which might be intimidated by the cost and complexities of standard listing.

"I know that your council has been considering the idea of a junior stock market. I would love to know just how far those discussions have progressed."


Source:
KERIL WRIGHT, Observer staff reporter
The Jamaica Observer
Friday, January 12, 2007

http://www.jamaicaobserver.com/magazines/Business/html/20070111T230000-0500_117787_OBS_BRUCE_GOLDING_CALLS_FOR_REGIONAL_STOCK_EXCHANGE.asp