Laos learns from Thailand's securities market experiences

Laos learns from Thailand's securities market experiences

The good corporate governance of listed companies on the Lao Securities Exchange (LSX) is considered paramount to funding and achieving the country's five-year development plan.

The LSX Commission and the Securities and Exchange Commission of Thailand (SEC) held a joint workshop last week on the importance of the securities market to national economic development.

The workshop was held at the LSX building, with participants coming from various related offices.

The workshop focused on the importance of capital markets to national economic development, corporate governance, and the role of the securities exchange for investor protection in Thailand, and featured presentations by representatives from SEC.

Head of the LSX Commission Ms Vatthana Daraloy said during the workshop that a robust securities market is vital to Laos' economic development.

“With our previous five-year development plan, we fac ed the problem of limited funding, especially long-term funds, because we didn't have a securities market at that time. Funding for production and services were limited, costly and hard to access.”

The experiences of many developed and developing countries have shown that establishing a securities market is part of the solution.

“Now we have a securities market. However, for the market to contribute to the country's economy, we need to have good operation and transparency in the market.

The good corporate governance of the registered companies is paramount and we should have that in detail,” Ms Vatthana said.

“This workshop is a great opportunity for us to learn from a neighbouring country like Thailand, which already has many years of experience on the issue,” she added.

The SEC was established in 1992 and performs the functions of the capital market supervisory agency with the status of an independent state agency.

Development of the LSX began in 2007 as a joint venture between the Lao government, which has a 51 percent stake, and a Korean company, which has a 49 percent share. The primary market opened on October 10 last year and the secondary market for public trade opened on January 11.

At present two enterprises, EDL Generation (EDL-Gen) and Banque pour le Commerce Exterieur Lao (BCEL), are listed on the exchange, with shares sold through only two brokers - Lane Xang Securities Public Company and BCEL- KT Securities Limited.

vientiane times