Speakers at a public forum on the development of the capital market in Ghana have underscored the need for a strong and independent regulatory commission to promote public trust and confidence.

They held that an independent regulatory body would not only enhance accountability and transparency among market participants but also provide a safeguard to minimise the risk of participants for the survival of the capital market.

The speakers made the point at a public lecture organised by the Securities and Exchange Commission (SEC) as part of its education drive to get the public acquainted with operations of the capital market. The lecture on the theme: "The Capital Market in Ghana: The Way Forward," formed part of the Financial Literacy Week being marked by the Ministry of Finance and Economic Planning.

The literacy programme is expected to raise public awareness and enhance understanding of the range of products and services being offered by financial institutions.

Mr. Dick Naezer, 1st Counsellor and Acting Head of Delegation of the EU in Ghana, said a good system of regulation would ensure that investors were protected from fraud and their risks minimised to enhance benefits.

He said while the Ghanaian bourse had performed creditably over the years, the problems of liquidity and high transaction cost were working against investors' interest in the market.

Mr. Naezer therefore suggested a further liberalisation of the market and ensuring prudent management of risk and public education to deepen the understanding of the people in the market. Besides, there was the need to pursue vigorously the integration of the stock exchanges within the sub-region.

Mr. Naezer said the integration of the exchanges would allow the handling of big transactions and more listings as companies across the region could look for funds beyond their countries.

Mr. David Tetteh, Head CAL Brokers Limited, said low capitalisation, the offer of similar products and inactive trading in most equities were some of the problems working against public interest in the bourse.

Currently there are 34 listed equities on the bourse but only 10 of them see active trading.

Mr Tetteh said appropriate incentives must be provided to enable more companies to list on the exchange to offer the necessary diversification and pool of investment to investors.

There was also need for raising the minimum capital requirements for the Licensed Dealing Members to deal with the problem of liquidity and to enable them to handle bigger transactions.

Mr. Michael Cobblah, Country Representative, Ecobank Development Corporation, called for effective collaboration between dealers and the regulators to promote development in the market.


Source: GNA