KUALA LUMPUR: The overall deepening of Asean's capital markets will remain challenging if advanced countries do not create an inclusive environment for their less developed counterparts, said the Securities Commission.
"The development of capital markets is a main objective of the Asean Capital Markets Forum (ACMF) as we see Asean capital markets to have the potential to grow as much as US$3.5 trillion in the near term," said its executive chairman Tan Sri Ranjit Ajit Singh at CIMB Asean Research Institute (CARI)'s Asean Roundtable Series this morning.
"However, we have seen that when it comes to the discussion of deepening of Asean capital markets, there are only two or three countries within Asean that would be able to participate because they already have the depth that is needed, while the majority of countries don't."
Ranjit called for the ACMF and all countries involved to create a more inclusive environment when it comes to cross-border initiatives so that all of Asean would be able to reap the benefits.
He went on to say that though he understands that these countries would prefer to focus on their own domestic markets first, they must also be aware of the benefits of going cross border while doing so.
"The key take-away is that, for the Asean preposition to work, all Asean countries need to work together," he said.
"Though I understand that some of the countries need to work on the deepening of their own domestic capital markets, it is still important for them to also capitalise on the burgeoning interconnectivity of Asean markets. They do not have to go at it alone as they can readily tap into the existing strength of Asean."
Ranjit called upon the industry to submit recommendation papers to their respective regulators so that the regulators will be aware of their restrictions and work at it together on the ACMF level.
"The Asean preposition can only work if we work together, which we already are. However, there are still much to be done if we want to reach the goals that were outlined in the Asean Economic Community (AEC) Blueprint 2025."
Goals of the AEC 2025 include trade liberalisation, behind-the-border reforms and policy harmonisation; all of which is critical to Asean’s future economic prosperity.
Titled "Deepening Capital Markets in Asean: Opportunities and Challenges," the roundtable was also attended by chairman of CIMB Group, Datuk Seri Nazir Razak and CARI chairman, Tan Sri Munir Majid.