SRI LANKA TO BE FINANCIAL CENTRE OF THE REGION

By - Charumini DE SILVAThere is tremendous opportunity for foreign companies to get listed in the Colombo Stock Exchange (CSE) and this will pave Sri Lanka to be a financial centre in the region, Securities and Exchange Commission (SEC) Director General Channa de Silva told Daily News Business.

The Colombo Stock Exchange

SEC DG Channa de Silva

“However to have a stable and a competitive economy, the country should have a strategic plan whilst having a competitive industrial plan. In each of these, industries are significantly important to properly map out the architecture of the country,” he said.
He said the capital market, which contributes around 25 percent of the Gross Domestic Production (GDP) has the potential to rise up to 100 percent in the medium term. Therefore, it is vital that we need to promote medium and large-scale industries to get listed in the stock market to grow substantially from the current level to a higher level.
The Director General said there are five new stock broking companies, which are expected to commence their operations during the year and they also expect to open branches outside Colombo to bring in more clientele to the capital market.
At present, few keen foreign stock broking companies from countries such as India, Malaysia and Singapore has also applied for stock broking licence with the outstanding performance of the CSE. If these companies will get selected it would help their clientele to get exposure in Sri Lanka.
“Domestic investors are keen on investing in the stock market and have shown a significant response with peace being established in the country. With the drastic drop in the interest rates there is much potential for growth. Virtually to get the same or a better performance in the stock market many ground to travel as our stock market is still in the early stage of developments,” de Silva said.
De Silva said by the end of April many companies will get listed in the CSE. This will be helpful to gain more capital for these companies and it will also create more choice for the investors, as they do not have to track behind the existing stocks. We need more new companies listed within the next three to six months, as it is vital to commence and promote business for the market to be driven high.
Opening up a stock market branch is strategic and it provides a good indication for the people in Northern province that are keen on investing in the capital market. Promoting Initial Public Offerings (IPOs) and medium scale business are important, he said.
At present, the number of transactions, market capitalization and the volumes have increased rapidly. With the volumes increasing, the level of liquidity has enhanced and that has created much confidence and satisfactory among the investors.
The CSE being in the forefront of the economy is optimistic about the year ahead and is confident that this momentum will continue, de Silva said.

source - www.dailynews.lk