Govt. failed stock market investors in 2016 says CBSA Head


Ravi Abeysuriya

By Hiran H.Senewiratne

The year 2016, could be branded as a year wherein the government failed to live up to the expectations of stock market investors. president, Colombo Stock Brokers Association Ravi Abeysuriya said,

 "Limited progress had been made in implementing policy reforms last year  and in crafting and practising a sound economic policy package for the stock market, which did not perform to the expected level, Abeysuriya told The Island Financial Review.

He said that the stock exchange needs inspiration to ensure the exchange attracts genuine investors and that it provides opportunities for a broader group of local and foreign investors to invest in the stock exchange.

 "To ensure this, the government should act as a facilitator and implement the capital market reforms identified in the 2017 budget, he said.Abeysuriya added that at least in 2017, "We expect the government to create a more conducive environment that provides a level playing field and creates long-term investment friendly policies that will benefit all companies, for the private sector to create new job opportunities, increase exports and investment."

He said that successful policy implementation will be key for the stock market to perform in the new year. "Therefore, 2017 should be a year for the government to make real progress in fulfilling the promises and deliver on expectations, the CSBA Head explained.

 "CSE is under-owned, versus other frontier market peers and as a result people in Sri Lanka miss out on the ‘power of investing’, particularly to build long term savings for retirement, Abeysuriya said.

"The long term institutional funds, such as, provident funds, insurance companies and Unit Trusts, collectively, own only 6.5 percent of the Rs 3.1 trillion stock market capitalization. Similarly, only 6 percent of Rs 133 billion assets under management of Unit Trusts is in pure equity funds in Sri Lanka and only about 25,000 credit default swap accounts are active, Abeysuriya added.

"The stock market offers the means to participate as an owner in the growth of the companies that make up the Sri Lankan economy.

"Investing calls for optimism about future opportunities. It requires investing wisely, taking a reasonable amount of risk and a long-term view and most importantly, getting professional help, Abeysuriya elaborated.

The CSBA is an apex industry body, representing the stock broking companies, licensed and regulated by the Securities and Exchange Commission of Sri Lanka.

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