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Kingdom joins ASEAN securities plan

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A man watched the CSX’s market index in December, 2020. Hean Rangsey

Kingdom joins ASEAN securities plan

The newly-renamed Securities and Exchange Regulator of Cambodia (SERC) and its nine capital-market-regulator counterparts in ASEAN on March 15 signed a new five-year Action Plan 2021-2025 for the development of the sector.

The plan was signed during the 34th ASEAN Capital Markets Forum (ACMF) hosted via video link by Bruneian central bank Monetary Authority of Brunei Darussalam, which also regulates capital markets in the small country on the island of Borneo, ACMF said in a press release.

“The action plan builds on ACMF Action Plan 2016-2020, and was developed with feedback from capital market participants and other stakeholders to ensure [its inclusivity and relevance], particularly amid the new normal.

“The action plan will be presented to the ASEAN finance ministers at the ASEAN Finance Ministers Meeting to be held at the end of March 2021 for endorsement.

“In realising the ACMF Vision 2025, the action plan sets out three strategic objectives, namely – fostering growth and recovery with sustainability; promoting and sustaining inclusiveness; and strengthening and maintaining orderliness and resilience.

“The five key priorities that support the strategic objectives are – driving higher levels of transparency and disclosure; continuing with regulatory harmonisation; intensifying capacity building; amplifying communication and awareness building; and strengthening cooperation and coordination,” it said.

SERC director-general Sou Socheat told The Post on March 16 that ACMF provides ample opportunities for the Kingdom’s young securities regulator to learn from its regional counterparts and have a chance to share knowledge and train local specialists.

“The forum will serve as an avenue for us to exchange experiences with our ASEAN peers, to synthesise knowledge about capital markets and to develop well-versed officials,” he said, adding that SERC will take over the rotating chair of ACMF next year.

Ha Jong-weon, vice-chairman of Cambodia Securities Exchange (CSX), stressed the importance of the action plan, noting that it outlines the collective goals and key strategic blueprints for ASEAN member countries to develop a sustainable capital market.

“ACMF is also playing another important role in integrating the ASEAN capital market through various initiatives such as introducing ASEAN asset classes, cross-border trading, an ASEAN online trading platform, regulatory harmonisation and so on,” he said.

According to ACMF, the ASEAN regulators underscored their commitment to ensure the “continued traction” of the forum’s sustainable-finance initiatives already rolled out, which it listed as “the ASEAN Green Bond Standards, ASEAN Social Bond Standards and ASEAN Sustainability Bond Standards”.

“Since 2017 until the end of 2020, a total of $8.35 billion bonds labelled under these ASEAN standards have been issued,” it added.

But SERC’s Socheat pointed out that challenges remain if the Kingdom wants to develop its securities market in line with regional frameworks.

“We are facing a handful of challenges – for instance, the issuance of cross-border securities, which we cannot do given that our main focus is on the local market.

“Then there’s the issue of green bonds. While we currently issue bonds, we don’t give out any with the green label, but it is in our plans. And although we have yet to implement a number of action plans, we will do so in the upcoming years,” he said with a sense of optimism.

At present, there are 13 listed companies on the bourse – seven stock-listed and six corporate bond-listed. Since CSX’s inception in 2012, the companies have raised a combined $253 million as of September 30.

Last year, two companies listed stocks and three listed bonds. The five firms raised a combined $92 million in January-September, the latest figures published by CSX show.

The stock index increased more than 57 per cent in 2019 compared to the previous year, only to dip 14.93 per cent in 2020.

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