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Mekong countries agree on capital market

Thailand and other Mekong region countries have agreed a deal which will pave the way for increased capital market cooperation, with a view to boosting economic growth across the region.

In addition to Thailand, the Greater Mekong area includes: Vietnam, Cambodia, Laos and Myanmar, through which the Mekong River runs.

The Securities and Exchange Commission of Thailand said Myanmar, which is in the process of setting up a capital market regulatory body, will consider joining the pact for the cooperation and development of capital markets in the Mekong sub-region in the “near future”.

At the third Mekong Capital Markets Cooperation meeting held last month, the Thailand capital market regulator said the member countries focussed on capital market infrastructure including mutual recognition of regulatory standards and practices, development of collective investment scheme business and promotion of financial literacy.

The announcement coincided with another initiative by the Thai regulator to allow foreign companies to raise funds through an initial public offering in Thailand and dual offerings where IPOs by foreign companies are launched in Thailand and other countries simultaneously.

Vorapol Socatiyanurak, secretary-general said: “[The] development of Thai capital market to become even more attractive to global investors is, of course, among the Securities and Exchange Commission’s priorities.

“One way to support the said development is to ensure that our capital market can also serve as a fund raising channel for [the] expansion of foreign businesses and economies, while providing a variety of investment choices for investors.”

The new listing rules will take effect in August and are seen by the Thai regulator as a mode to enhance competitiveness of the Thai capital market.The Thai regulator had unveiled a 2014-2016 strategic plan in January aimed at transforming it into a regional investment hub, which included measures such as the development of the Thai capital market.

Furthermore, at the beginning of this year, the Stock Exchange of Thailand (SET) had laid down a three-year plan to become a major regional player, which included allowing foreign companies to list for the first time.

The Thai regulator in February also spelt out draft rules for selling cross-border ASEAN collective investment schemes to retail investors, while recently it allowed additional fund distribution channel.

Part of Mark Allen.