After achieving macroeconomic stability, economic discourse is unison: the focus of economic policy must be to accelerate GDP growth rates.
The conclusions of the previous and this year’s Kopaonik Business Forum are expected to reinforce this, emphasizing the need for stronger investments and institution building.
With the ambition of achieving this goal, economic policy should focus on the availability of diversified sources of financing for the growth and development of micro, small and medium-sized enterprises, stimulating innovation and entrepreneurship, efficient mobilization and allocation of domestic savings and capital, with new impulses to attract foreign ones, then on increase in productivity and exports, and consequently the competitiveness of the domestic economy.
Finally, part of the focus must be on improving the municipal infrastructure and putting additional pressure on reducing unemployment, educating and developing human capital, preventing its outflow, and creating a knowledge economy.
On the other hand, in addressing the challenges of economic growth, especially after the consequences and lessons learned during and after the previous economic crisis, the EU identifies the development of the capital market as a precondition for developing and improving the competitiveness of the Union economy.
It is with the aim of accelerating the rate of economic growth, fostering innovation and raising employment rates that the EU, although only six years after the crisis, has created a Union strategy for the capital market. Its key principles are: creating new investment alternatives for investors, linking sources of funding to the real sector and creating a stronger and more resilient financial system by expanding funding sources with more long-term investment options that will reduce the vulnerability of the economy and citizens to financial shocks.
Struggling for a very long time for a place that objectively, now in a way, has been proven in the Serbian economic formula, the Belgrade Stock Exchange changed its business strategy several years ago, meeting the time when the capital market will finally be recognized as, until now completely untapped, a mechanism for achieving consensus-declared goals.
The Belgrade Stock Exchange’s strategic proactivity has created a new capital market value chain based on an innovative and scalable approach to creating market infrastructure to meet the diversified needs for external long-term financing using market mechanisms.
The five key focus areas of the Belgrade Stock Exchange’s business strategy include creating a regulatory and market framework for financing innovative micro and small businesses, namely crowdfunding and crowdlending. The second and third focus are on promoting the IPO as a strategic response of the mature private sector, ie the mechanism of privatization of the public sector, while the fourth and fifth ones relate to a more significant adaptation of the tax environment and protection of investor rights.
However, until July of the previous year, the key weakness of the Belgrade Stock Exchange strategy was the lack of a comprehensive national strategy, and hence its weak reach.
Practically, a key turning point in the capital market’s inclusion in the Serbian economic formula, that is, indicating the desirability of full compliance with the supporting objective proposed by the economic community – more robust economic growth, is the education and start-up of the Ministry of Finance’s Working Group on Capital Market Development Strategy.
The Ministry of Finance presented its draft about ten days ago. The first part relates to the improvement of the regulatory framework with the aim of activating the capital market as a channel for access to finance for business entities, increasing the number and types of available financial instruments, while simplifying market access for investors and improving the protection of their rights.
The second part is aimed at improving the institutional framework and strengthening the capacity of institutions instrumental to the functioning of the capital market in order to increase their efficiency and build confidence in them. Particularly important, the third part deals with the introduction of fiscal, administrative and other incentives for non-debt financing of growth, development and competitiveness of the economy with a view to a more dynamic use of capital market mechanisms, while the fourth focuses on educating the private sector and the population in order to foster innovation, competitiveness and financial literacy.
It is quite clear that the implementation of this Strategy will not produce results overnight, of course, but reasonably ambitious expectations can be met if we witness in the near future initial and secondary public offerings of shares of companies from both public and private sectors, first green bond issues, municipal securities issues of value of a different kind, and very important: an established regulatory framework to support the crowdfunding platform for financing startups, Danas reports.