The International Organisation of Securities Commission has said that efforts are being made to boost the global securities market.

According to the commission, this has become imperative if the global economy is to have the right global institutional structures in place for the tasks at hand and the profound market changes that are likely to occur in future.

The Secretary-General, IOSCO, Mr. David Wright, noted that there was the need to set up and institute standards that would boost the financial markets in both developed and developing countries.

Wright, who stated this in a statement on Wednesday, said that the fast growing regions of the world had come to realise that they could no longer rely on the international banking system to support their economic development ambitions only.

The statement posted on IOSCO website explained that the commission would set up a foundation to develop securities market entrenched with sound standards.

It said, “There is also an important emerging market perspective to consider here. Some emerging market countries are (rightly) growing in confidence to consider themselves as having graduated to the ‘emerged’ category. Others continue to look towards developed economies by learning from their successes, and recently, their shortcomings.

“In line with this, therefore, IOSCO has a major role to provide technical assistance to help its members develop their securities markets on the basis of sound IOSCO standards and principles and intends to step up its efforts by developing an IOSCO Foundation for this purpose.”

Wright also added that over time, all the fast growing regions of the world had fully realised that they could not rely on the international banking system to support their economic development ambitions, thus emphasising the need to build strong securities market.

Earlier this year, IOSCO had cautioned the regulators of the Nigerian capital market on proper regulations of the derivatives market, on the backdrop of plans by the Nigerian Stock Exchange to develop its derivatives market in the next few years.

The IOSCO spokesperson, Ms. Carlta Vitzthum, said if proper cautionary measures were not adopted, the derivatives could lead to a crash of the Nigerian market.

To this end, the statement added that there was the need for effective regulation of the market to avoid another major crash, similar to the one that occurred in 2008, from which the capital market has yet to recover.

Vitzhum had noted that before 2008 that the derivatives market intermediaries were not properly regulated, which according to her, led to sharp practices and other market anomalies, as witnessed during the 2008 financial crises.

She explained that IOSCO was proposing some principles aimed at guiding the operations and by which regulators could access the activities of the funds.

Source: Punch (written by Udeme Ekwere)