12:00 AM, July 17, 2011 / LAST MODIFIED: 12:00 AM, July 17, 2011

SAFE takes steps to develop stockmarkets

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Gazi Towhid Ahmed

South Asia Federation of Exchange (SAFE) has decided to provide consultancy services to the countries of South Asian Association for Regional Cooperation (Saarc) to help develop respective stockmarkets.
The federation has taken steps to increase co-operation among Saarc countries to develop and expand their stockmarkets, said Fakhor Uddin Ali Ahmed, SAFE's vice president.
SAFE took the decision on July 6 after a meeting of its executive committee in Nepal.
The central bank of Nepal showed interests in consultancy services for Saarc countries, said Ahmed, also a president of Chittagong Stock Exchange.
The consultancy service of SAFE will offer help to formulate securities regulations, demutualisation of stocks, establishing new indices for selected stocks and other technological support to the regional countries.
SAFE has also decided to form a 'Saarc Mutual Fund' by August to stop a liquidity crunch in capital markets.
Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka will sponsor the fund, said Ahmed.
He said asset manager, trustee and custodian of the fund will come from the Saarc countries. The size of the fund has to be determined too.
“We will supply liquidity from the fund for Saarc countries to face liquidity crunch and stabilise the stockmarkets,” he added.
Finance Minister AMA Muhith also showed interests in the Saarc Mutual Fund, said Ahmed, adding that they will sit with the minister as early as possible to discuss the fund.
SAFE is a forum launched by bourses in South Asia to promote the development of securities markets in the region. The inception of SAFE marks an important milestone in the growth of South Asian capital markets towards regional and global integration.
The imperatives of globa-lisation necessitate increasing interdependence among nations in terms of business, politics and cross-cultural activities which SAFE should facilitate in the Saarc countries.
The members of SAFE have agreed to work toward setting common standards, including adoption of international accounting standards and best business practices in the capital markets.

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