New Securities Law Drafted for Issuing State Securities
AKP Phnom Penh, July 31, 2020 --
The Royal Government of Cambodia is working to draft new law on government securities to replace the old one, aiming mainly to allow the government to issue sovereign bonds to promote the country’s capital.
In a press release issued on July 30, the Ministry of Economy and Finance said that the new law will pave the way to issue state securities, mobilise domestic financing, diversify the state capital portfolio and curb external borrowing.
Demand for resources and financing continues to climb and could meet the real needs of socioeconomic development if underpinned by proactive measures to broaden the scope of funding sources, with emphasis on high-potential local ones, it added.
“This new draft law is a legal foundation to allow the government to be able to issue securities by setting the scope, deciding on the issuance, setting the size and form of the issuance of state securities, setting the participants and procedures for trading state securities, as well as penalties,” read the statement.
“The new draft law is comprehensive and highly responsive to the current context and changing trends of Cambodia’s development through the setting of a common framework for the management of the issuance, trading and management of state securities, the ministry said.
The setting of specific objectives of the new law include responding to financing needs, especially for infrastructure development, strengthening the management of cash requirements, developing the securities and finance sector, and supporting other priority and necessary projects.
There are currently six-listed bond companies on the Cambodia Securities Exchange (CSX), launched in 2012, and six stock-listed companies.
By Chea Vannak