Cambodia to establish stock market in 2009

''Cambodia will be able to successfully materialize the vision of establishing the Cambodian Securities Market in 2009,'' Hun Sen said at the launch of the Cambodia Securities Market project held in Phnom Penh.

''Indeed, a security market is the lifeblood of capitalist economy, which will actively contribute to mobilizing financial resources to finance the national economy, and to ensure sustainable economic growth,'' he said.

Hun Sen said Cambodia has intended to establish such stock market since 1995 but it has been repeatedly put off due to its weak banking system.

After nearly three decades of civil war, Cambodia is now at peace and its bank deposits increased from 9.5 percent of gross domestic product in 2000 to 18.5 percent in 2006.

''In 2006, the banking system contributed US$500 million to finance economic development. This is the first time in our history that bank financing reaches the same level of the financing provided by our development partners,'' Hun Sen said.

Keat Chhon, the finance minister, said a stock market cannot be established unless ''necessary and sufficient conditions'' are met such as an appropriate level of economic development, legal and regulatory frameworks and infrastructures, securities issuers, investors and securities intermediaries.

In the lead-up to establishing a stock market in the next two years, Cambodia has conducted many studies, got advice from many experienced foreign experts and is in close cooperation with the Korea Exchange.

The South Korean government, through the Korea International Cooperation Agency, is supporting a project for securities market development from 2007 to 2009 that is worth of US$1.8 million. Hun Sen said Cambodia selected as strategic partner the Korea Exchange, one of the world's leading stock exchanges, to help establish the securities market in Cambodia after the state visit of South Korean President Roh Moo Hyun in November last year.

Young Tak Lee, chairman of Korea Exchange, pledged Thursday the South Korean government and Korea Exchange will be in full support of establishing a stock exchange in Cambodia.

He said that in the 1960s, South Korea was predominantly an agricultural society but now the service and manufacturing sectors take up by far the largest shares in both the production and employment.

''And as a result of the aggressive capital market fostering policies, the number of listed companies increased from 15 in 1961 to 1,694 in 2006. The total market capitalization also grew from US$74 million in 1961 to US$835 billion in 2006,'' he said.

//Kyodo news