Local exchanges sign MOU with ASX

JAKARTA (JP): Indonesia's capital market should expand cooperation with developed markets in the Asia-Pacific, Indonesian Capital Market Supervisory Board (Bapepam) chairman I Putu Gede Ary Suta said yesterday.

Putu said information exchanges would help stop manipulative investors and brokers entering the Indonesian capital market.

He was speaking after signing memorandums of understanding between the Australian Stock Exchange (ASX) and the Jakarta and Surabaya Stock Exchanges, and between Indonesia's Bapepam and the Australian Securities Commission (ASC).

Putu said the Indonesian capital market was still in its infancy and the possibility of market fraud was high. "We do not know if investors are qualified and of good repute," he said.

One thing the JSX could learn from the ASX's management operation was the way it accommodated mining companies.

He said there were about 1,200 Australian mining companies listed in the ASX. "We need to learn from them," he said.

Putu foresaw the possibility of Indonesian-Australian joint venture companies of being listed simultaneously on both exchanges.

Cooperation would help the exchanges anticipate the future of borderless transactions, he said. "Today someone does not need to be present at the exchange and public offerings can be done through the Internet".

He said market regulators were needed all over the world to investigate market manipulation.

He said there was an increasing flow of funds between Asia- Pacific nations and multilateral and bilateral cooperations would help protect investors' interests.

Putu said Bapepam had sent several people to Australia to learn how to identify market manipulation, how law enforcement was conducted and how the ASX detected insider trading.

Bapepam has also signed cooperations with the U.S.' Securities and Exchange Commission, Hong Kong's Securities and Futures commission and Malaysia's Securities Commission and would soon cooperation with Japan's Securities Commission.

ASC chairman Alan Cameron agreed with Putu and said the ASC had signed cooperation agreements with securities and market regulators in the U.S, Britain, France, New Zealand, Hong Kong, China and Canada.

Cameron, who is also former president of the committee of International Organization of Securities Commission said emerging markets in the Asia-Pacific, South America and Eastern Europe accounted for up to 10 percent of global investment funds. (09)