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Discussion on Capital Market Development

By Mariam Chanishvili
Thursday, March 15
The ISET research institute together with TBC Capital organized a discussion meeting on Capital Market Development within the frames of the project “Reformeter”.

During the discussion, the strategy of capital market development was evaluated.

The event was attended by Deputy Finance Minister, Nikoloz Gagua, Regional Director of European Bank for Reconstruction and Development (EBRD), Bruno Balvanera, International Monetary Fund (IMF) Resident Representative in Georgia, Francois Painchaud, Chief Executive Officer of TBC Bank, Vakhtang Butskhrikidze, Director of the International School of Economics at Tbilisi State University, Eric Livny, numerous businessmen, etc.

The Project is implemented by ISET Policy Institute and supported by USAID G4G. The goal is to generate reform progress analysis for policy making and public dialogue, and thereby promote informed debate about reform priorities and policy decisions, improve accountability and help build trust between the government, the private sector and the general public.

The reform was implemented by the National Bank, Ministry of Finance and Ministry of Economy and Sustainable Development. The reform is guided by the "Capital Market Development Strategy" adopted in 2016.

Eric Livny thanked everyone for the contribution and noted that involvement in this process is necessary and suggests improvements.

Bruno Balvanera emphasized the importance of transparency during the project.

“We have seen the remarkable advancement in Georgian private sector and corporate bonds in 2017,” stated Balvanera.

Nikoloz Gagua noted that the Ministry of Economy and National Bank of Georgia understand the importance of the issue.

“This event is very important. We have a chance to discuss and receive feedbacks,” said Gagua.

According to the report of National Bank of Georgia, 67.7% of the Capital Market Reform has been fulfilled. This indicator equaled 51% last year. Along with other important events, the German rating agency “Scope” has been added to the list of recognized agencies (Standard & Poors, Moody's, Fitch) by the National Bank of Georgia, as a reliable agency for rating mortgages securities by the National Bank.

Scope is the leading European provider for credit ratings, fund analyses as well as bespoke solutions for assessing and monitoring risk.

Also, the so-called free-float relief has been replaced by the wider and more flexible privileges available to the investors, with the capital gain exempted from tax in the tax code.

With the help of experts from the IMF, a package of tax reforms has been developed based on international practices.

Some remarks about the reforms have been made during the discussion.

TBC Capital is an advisory arm of TBC Bank offering Corporate Advisory, Research and Brokerage solutions in Georgia.