How can the stock market of Belarus change
The Ministry of Finance of the Republic of Belarus has developed a document that will give a new round to the development of the local stock market. The project proposes to allow non-resident issuers of the country to present securities on the domestic stock exchange.
This resolution says about the options to simplify the existing procedure for registration of shares of foreign companies that want to be represented on the Belarusian stock market. However, studying the document, the authors of the project recommend separating two notions – admission that allows offering and circulation.
If the decree is approved, companies and individuals, who have bought shares of non-residents outside Belarus, will also have the opportunity to conduct trading operations on the local stock exchange. Another positive moment for foreign market participants will be the registration of their shares in the country’s depository.
Officials noted that they are already willing among foreign companies that want to be placed in the Belarusian market.
The document developers hope that it will significantly expand the types of equity securities, representing foreign issuers at the local stock exchange. This is an excellent opportunity for the national stock market to increase liquidity and provide an incentive for development of the segment of equity financial operations.
The project has a separate item on expanding the list of foreign exchanges where shares of companies that are allowed to be listed in the country were listed.
In case the project is accepted, then it will be possible to carry out operations with the securities registered in the various states, including with the developed economy at a local stock exchange. The selection of countries will take into account their compliance with the rules on prevention of money laundering, which is obtained by criminal means. Another condition for listing on the Belarusian market is that the securities must be listed on exchanges that are members of the World Organisation of Exchanges or a similar association in the CIS.
The document provides a list of international companies that have the right to be represented in the local market. This includes the main financial institutions of the European Union and the Eurasian Economic Union.
It is worth noting that the stock market of the country is underdeveloped. The minimum share of the stock segment in the total number of transactions is less than 3%. The bond market occupies 97% of the total number of transactions. Last year there was a significant reduction in the volume of transactions with securities represented by the state, while transactions with securities of corporate issuers increased in number.
In total, over the previous period the securities market carried out transactions for the total amount of almost 30 billion Belarusian rubles. This figure is 0.4% less than in 2018.