Monday, 18, November, 2019

On October 7, President Shavkat Mirziyoyev chaired a meeting dedicated to the development of Uzbekistan's stock market, the presidential press service said.

At the meeting, he noted that the mechanism for issuing securities and selling them on the stock market is not being efficiently used. The total value of shares in the stock market is at 25 trillion soums, which is barely 6% of the GDP, and cited examples: in Singapore this figure is at 188%, in Malaysia - 112%, in Russia - 34%.

After a long break, the issuance of government bonds was resumed. However, they were sold only to banks through the currency exchange. The number of professional stock market participants is below 100, said Shavkat Mirziyoyev.

He instructed to develop a stock market development strategy for 2020–2025 and bring the value of freely traded securities to 10–15% of GDP over this period.

The state owns 85% of the shares of 605 joint-stock companies. Of these, only 5% are traded on the stock market - the shares of 105 companies.

The President pointed to the over-regulatedness of the sector, with about 100 regulations and many restrictions. In developed countries, banks are active participants in the stock market, and in Uzbekistan, banks are prohibited from buying shares of other entities in the primary market. Legal acts need to be revised, removing unnecessary restrictions and simplifying work in the stock market, he noted.

Shavkat Mirziyoyev set the task to increase the types of securities on the capital market, taking into account world practice. He discussed measures to increase the demand for securities, attracting foreign exchanges, brokers and banks to the Uzbek stock market, directing some part of the assets of insurance companies to the stock market and allowing banks to purchase highly liquid securities in the primary market.

In addition, he pointed to the need to strengthen the protection of the rights of investors and minority shareholders, to improve the procedure for payment and collection of dividends. He also instructed to improve corporate governance, switch over to international standards of financial reporting and international audit.

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