ASEAN to set up new policy over overseas funds<\/p>\n
KUALA LUMPUR (AFP): Capital market regulators of Southeast
\nAsia's free-wheeling economies agreed yesterday to set up a forum
\nto evolve common procedures for tapping overseas funds and beef
\nup enforcement of laws governing their fledgling markets.<\/p>\n
The forum's proposed functions include laying the groundwork
\nfor improving stock clearing and settlement systems and
\nharmonizing capital requirements, and cross-border enforcement of
\nlaws in the Association of Southeast Asian Nations (ASEAN).<\/p>\n
Except for Brunei, which does not have a stock exchange, the
\nother members -- Indonesia, Malaysia the Philippines, Singapore
\nand Thailand -- agreed to the setting up of the so-called ASEAN
\ncapital market regulators consultative group.<\/p>\n
Malaysia floated the proposal at the first ASEAN capital
\nmarket regulators symposium, which opened here yesterday, and it
\nreceived immediate endorsement by the other members.<\/p>\n
\"Singapore certainly welcomes this proposal, which will help
\ndevelop the region's capital market in tandem with economic
\ngrowth,\" said Koh Beng Seng, deputy managing director of the
\nMonetary Authority of Singapore's banking and financial
\ninstitutions group.<\/p>\n
Malaysian Security Commission chairman Munir Majid said the
\nconsultative group would meet at least once a year.<\/p>\n
Munir said the group would try to devise a regional stock
\nclearing and settlement system and improve existing systems in
\nASEAN countries through harmonization of guarantee fund
\narrangements and wider coverage of fidelity funds.<\/p>\n
Requirements<\/p>\n
It would also harmonize capital requirements through a
\nproposed three-tier approach to capital adequacy involving paid-
\nup capital, borrowing limits and minimum liquid funds, Munir
\nsaid.<\/p>\n
\"At the primary level, with the funding through the capital
\nmarkets, particularly equity financing, assuming increasing
\nimportance, enormous opportunities are thrown up for ASEAN's
\nfinancial sector, of which I don't think they are getting a fair
\nshare,\" Munir said.<\/p>\n
Cross-border sharing of information to fight market fraud
\nwould also be among the tasks of the group, whose first meeting
\nwould be held soon to establish working groups comprising also of
\nindustry specialists, officials said.<\/p>\n
\"Without close cooperation and exchange of information,
\nregulators will be overwhelmed by the nature, amount, and speed
\nin which huge amounts of funds can be transferred from one market
\nto another,\" Ekamol Kiriwat, secretary-general of the Thailand's
\nSecurities and Exchange Commission said.<\/p>\n
Market capitalization of the stock exchanges in ASEAN have
\nincreased from US$174 billion at the end of 1991 to $583.8
\nbillion at the end of last year, representing more than a three-
\nfold increase in two years, officials said.<\/p>\n
\"With such quantum growth, capital market regulators in the
\nregion have to continuously be on guard to ensure that the market
\nis not disrupted and investor-interest is protected,\" Azman
\nHashim, vice-president of the ASEAN Business Forum said.<\/p>\n
Bacelius Ruru, chairman of Bapepam, Indonesia's capital market
\nsupervisory agency, said a forum for ASEAN capital market
\nregulators to exchange ideas would help ensure market integrity,
\n\"a vital ingredient for attracting foreign investment funds.\"<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/asean-to-set-up-new-policy-over-overseas-funds-1447893297",
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