Kyiv, September 23, 2008 – Ukraine needs to accelerate the development of a transparent and well-regulated securities market – this the main lesson of the first year of implementation of the joint Programmatic Technical Assistance Partnership (PTAP) project jointly implemented by the World Bank and USAID.
The objective of this project is to help the Government, market regulators and market participants to develop Ukrainian capital markets in the perspective of their future integration in the EU single market in financial services, and in particular to create conditions for the successful introduction and development of second pillar pensions.
Over the past year, the PTAP has delivered advice and support to government and regulatory agencies on four main components: (i) Pension reform; (ii) Strengthening of the legal, regulatory and supervisory framework for securities markets and NBFIs; (iii) Strengthening of securities market infrastructure; and (iv) Developing the supply of domestic securities, focusing on the government bond market.
Going forward, the capital market policy reform agenda will be shaped by the Free Trade Agreement currently being negotiated between the Ukrainian Government and the European Commission. Specifically, Ukraine will face three fundamental challenges in integrating its securities market and NBFIs in the EU single market in financial services: (i) harmonization of Ukrainian legislation with EU securities market and NBFI Directives (Level 1) and Implementing Measures (Level 2); (ii) mutual recognition between Ukrainian securities market and NBFI regulatory agencies and their counterparts in EU Member States; and (iii) Adaptation of Ukrainian securities market professional participants, NBFIs, and securities issuers to the EU single market in financial services.
“The development of a well-regulated, broad, deep and transparent securities market and a sound NBFI sector is critical for Ukraine to sustain rapid growth and to ensure its successful integration into the EU single market in financial services envisaged under the Free Trade Agreement with EU”, – says Michel Noel, Lead Financial Sector Specialist from the World Bank.
The USAID and the World Bank stand ready to support the Government to design and implement the proposed policy reform agenda and action plan through a broad range of instruments, working in close collaboration with the European Commission.
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