The DR stock market: a boost for economic development

The Dominican stock market is booming, with an annual growth of 26%. This growth means that the volume of securities traded doubles every three years, according to Mario A. Franco, executive director of the Asociación de Puestos de Bolsa de la República Dominicana (APB).

“At the close of May, our market has 2.8 billion pesos in custody. This is an extremely important figure that has had an average annual growth of 26%,” reported Franco.

In the last year, the market has reached significant milestones with the public share issues of two key companies (Cesar Iglesias and Banco Promerica). These issues not only represent a crucial source of financing for companies, but also consolidate the stock market as a key driver of private sector development in the country.

The Dominican market has approximately 180,000 accounts: 30,000 approximately are generated by investment funds and 150,000 through the stock exchange posts, which are brokerage accounts.

“It is a figure that has been growing steadily, mostly accelerated in the last 10 months by the interest that has awakened the Dominican investor and by some mechanisms that have been implemented, precisely, digital to accelerate the process of opening accounts,” he said.

The stock market is crucial for financing in developed countries, allowing the private sector and the State to obtain funds effectively. It offers longer and more flexible terms compared to other financing methods, allowing for periodic interest payments and repayment of principal at the end of the term.

This is especially beneficial for private businesses, better adapting to their cash flows, with terms that can extend up to 30 years, averaging between 10 and 20 years.

Main challenge

The main current challenge according to Franco is educational, focused on increasing knowledge about the securities market among the public and the Dominican business community.

“We have a working table, in which the Superintendence of the Securities Market, the Stock Exchange, the Centralized Securities Depository, the Dominican Association of Trust and Investment Funds and the APB sit. We have been in a process for several months, working hand in hand with all these institutions to create an educational platform”, he said.

Franco pointed out that the Dominican market, despite its regulatory youth (23 years), is moving towards the digitalization of financial services, a process he considers crucial for the future development of the market.

Among the challenges facing the securities market is the digitalization of all services in general.

Optimism

Franco expressed optimism about the future of the securities market in the Dominican Republic, projecting continued progress towards a more robust and harmonized financial environment, to the benefit of investors, entrepreneurs and the country in general.

Tax Reform

He emphasized the relevance of financial instruments in the market, such as the bonds of the Ministry of Finance, highlighting their significant impact on the sector. He stated that in an eventual fiscal reform, the State will cautiously consider fiscal measures related to these key instruments.

Dominican Republic Securities Market Forum

Franco announced that next Thursday, July 11, the fifth edition of the Securities Market Forum (FMV), one of the most important events in the financial sector, will be held at the Hotel El Embajador and will feature the participation of financial analyst Marc Vidal, who will present his talk “Unboxing the Future”, where he will explore future trends, cybersecurity and its impact on society, the economy and business.

Source:Diariolibre.com

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Dominican Republic Live Editor

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