The World Bank regards Azerbaijan as a leading country in the region in holding major reforms for the capital market development.
Angela Prigozhina, who leads the WB financial and private sector work in the South Caucasus, announced about this in Baku on February 17, adding that another proof of Azerbaijan’s reforms in the financial sector is the launch of an information system developed in a relatively short period of time.
“Azerbaijan, for a very short period of time, has managed to hold large-scale reforms to develop capital market. During this time, much has been done, from the development of legal framework to the launch of this system today, which will give impetus to further development of the country’s capital market, its transparency and openness,” she added.
Prigozhina said the capital market development will open the Azerbaijani financial sector for new investments, including the foreign ones. Azerbaijani companies will also be able to enter the international capital markets. The Bank’s official further added that the WB will continue providing a support to Azerbaijan in conducting reforms of the financial sector.
“We will continue assisting the Azerbaijani government in reforming the financial sector to make it more stable, transparent and open to foreign investors. It is important the financial sector of Azerbaijan to be integrated into the international financial system for providing a support to the economic reforms in the country aimed at supporting the non-oil sector,” she stated.
Unified system launched
A ceremony of launching the integrated trade, post-trade and surveillance system on the Azerbaijani Capital Markets was held at the Azerbaijani State Securities Committee on February 17.
The system was developed as part of improving Azerbaijan’s capital markets and will enable to strengthen the control over the ongoing transactions, unify the process of receiving reports about the conducted transactions from the professional market participants and prevent possible manipulation and dissemination of insider information on the market.
The test work on introducing the software, as well as trainings for local specialists and participants of the exchange, who will use this system, have been recently conducted. In March 2011, the World Bank approved a loan worth $12 million to Azerbaijan for the implementation of the ‘Modernization of capital markets’ project.
In January 2015, the Korea Stock Exchange won a tender announced by Azerbaijan’s State Securities Committee on supply and installation of information systems of the capital market as part of the modernization and automation of the infrastructure of the capital market, which is being implemented on the basis of the joint ‘Modernization of the capital market’ project of the World Bank. The cost of the contract was roughly $5.5 million.
The total cost of the ‘Modernization of the capital market’ project is $15.8 million. Besides the World Bank, the State Secretariat for Economic Affairs of Switzerland (SECO) allocated a grant worth $1.6 million and the Azerbaijani government – $ 2.2 million for the implementation of the project. Information systems have four subsystems: trading platform, clearing and settlement system, depository information system and the subsystem of control over the market.