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Vajira Kulatilaka Chairman of SAFE and CSE

Leaders from the South Asian capital market were united in their call for improved integration of regional markets as they shared their views on the way forward for exchanges in South Asia, at an event recently held at the Colombo Stock Exchange (CSE). The views were expressed by Chief Executives of Stock Exchanges from around South Asia, who gathered in Colombo for the Executive Committee Board Meeting and workshop of SAFE.

SAFE aims to foster collaboration and co-operation among its members in order to develop their respective capital markets. Presently SAFE has members comprising of stock and commodity exchanges across South Asia and several depositories and clearing houses in the region as associate members. Sri Lanka has held the Chairmanship of the SAFE Secretariat since 2015.

Speaking at the event, Vajira Kulatilaka, Chairman of SAFE and CSE said that domestic exchanges have much to gain should we reinforce and improve out effort towards integration.

“As we all know, capital markets globally, regionally and even in our nations, are constantly evolving and embracing transformation. The role and impact of an exchange today, is well beyond what was defined at the inception of SAFE as an organization. This is even more so for emerging and developing countries, which many of us are a part of. It is therefore quite relevant that SAFE today looks at evolving as an organization,” he said.
He added: “We are well aware that our members are at different junctures in their bid for growth and improvement, which is a something that works to our advantage. It also outlines the importance and relevance of an organization such as SAFE.  Our diversity is our strength, and our ability to learn from each other through collaboration and knowledge sharing is a key benefit of being a part of an organization of this nature.

Smaller exchanges in the region for an instance have the ability to benchmark more developed peers, while our more developed peers have the privilege of shaping the future of fellow regional exchanges – a process that is brought into the table through affiliation.”
Aftab Ahmed, the Secretary General of SAFE who was involved with the process that saw a merger between the Karachi Stock Exchange, Lahore Stock Exchange & Islamabad Stock Exchange to form the Pakistan Stock Exchange said “It is critical that we also improve the governance of our exchanges and in our region through demutualization, mainly to relieve brokers from the governance aspects of the exchange so that the exchanges have the ability to provide products and services that are in the best interest of the investors.”

He also went on to highlight the importance of South Asian exchanges embracing the increasing influence of SMEs and startups in global affairs, stating that exchanges around the world are already reaping the benefits of providing fund raising opportunities to such enterprises.

Commenting on the high level of activity surrounding Initial Public Offerings (IPOs) at the Chittagong Stock Exchange, Shaifur Rahman Mazumdar, Managing Director, Chittagong Stock Exchange said: “The regulators have worked to change the rules and regulations to create a strong and transparent primary market. We therefore now have the platform ready to create a robust IPO market and we have experienced a strong demand for IPOs in our country. A number of large companies are in the pipeline of getting approval from regulators for listing on the exchange.”