Uzbekistan drafts measures to develop capital market, aims to attract $1 bln investment
TASHKENT. Dec 16 (Interfax) - Uzbekistan expects to attract at least $1 billion in investment through further development of its capital market, which includes the introduction of new financial instruments, according to a press release, posted on , Uzbek President Shavkat Mirziyoyev's website.
Mirziyoyev got acquainted with a presentation on the further development of the capital market and the acceleration of the implementation of international standards in the banking system, the press release said.
It said that today, the market value of securities in circulation was 275 trillion sum, while the volume of securities in free exchange trading hadreached 4 trillion sums. There are 717 issuers and 77 professional participants operating in the market. Market capitalization is only 20% of GDP, which is significantly lower than the global average.
In this regard, measures to attract at least $1 billion in investments to the local capital market have been discussed. In particular, there are plans to authorize dual listing of securities on local and foreign stock exchanges in accordance with international standards. The introduction of new financial instruments is envisaged, including foreign currency bonds, global depositary receipts, foreign securities and exchange-traded investment funds.
Particular attention was paid to the expansion of the special legal regime "regulatory sandbox," which would apply not only to non-residents but also to residents, establishing an indefinite term for foreign investors and to allow trading in stocks, bonds and other securities of foreign companies. It was noted that this will help reduce unofficial trading of foreign securities.
Proposals to attract more local investors to the capital market were considered. At the Tashkent Stock Exchange, local companies and banks will be allowed to issue bonds in foreign currency, enabling them to attract foreign currency funds without entering the external market. Also, the bond market can be expanded by allowing issuers to issue unsecured bonds in amounts exceeding their own capital.
Improving the control and regulation system in the capital market were discussed. Plans were presented to adapt national legislation to the requirements of the International Organization of Securities Commissions, strengthen the regulator's powers and gradually increase the charter capital requirements for professional participants.
It was noted that over the past seven years, as part of the banking system reforms, the assets of commercial banks had grown 5.3-fold, exceeding 877 trillion sum. The number of banks has reached 35, and three foreign banks have commenced operations in Uzbekistan since 2018.
For the first time, Uzbekistan has participated in the Financial Sector Assessment Program of the International Monetary Fund and the World Bank, which assessed areas such as banking supervision, risk management, payment systems, macro-prudential policy and crisis management.
"Based on the results of the assessment, the plan for next year is to bring Uzbekistan's financial sector into full compliance with the 29 Core Principles for Effective Banking Supervision of the Basel Committee. To this end, objectives have been set to ensure the full compliance of all commercial banks' financial statements with international standards, the final implementation of Basel III standards, and the establishment of a Financial Stability Council with the participation of the government and the Central Bank," the press release says.
Emphasizing that the capital market and banking system reform plays a crucial role in the stable financing of the economy, increasing the private sector's share, and boosting the attraction of international investment, Mirziyoyev set specific tasks for the ministries and agencies responsible.
