EBRD supports new law regulating Georgia's local financial markets
The Georgian parliament has passed a package of laws regulating the local financial markets and amendments to the capital market legislation, following close cooperation with the European Bank for Reconstruction and Development (EBRD), Trend reports referring tothe EBRD.
As reported, EBRD welcomed the decision as an important new chapter, in terms of developing the Georgian capital market.
The EBRD has worked closely with the National Bank of Georgia to improve the functioning of financial markets in the country, strengthen the local capital market and increase local currency lending.
The new law provides for the enforceability of derivatives transactions, including netting, close-out netting and financial collateral, amends a number of laws and reinforces the key related concepts, such as settlement finality.
This law puts Georgia on the derivatives' and netting map, allowing companies to safely and efficiently hedge their risk and exposure, including foreign exchange and interest rate, contributing to the development of a local currency financial market.
Experts with the support from the EBRD-managed Shareholder Special Fund, worked with the National Bank of Georgia and local market participants on the legal reform. This project was also coordinated with, and supported by, the International Swaps and Derivatives Association (ISDA).
According to Catarina Bjorlin Hansen, Regional Director for the Caucasus, the adoption of these laws marks a milestone in Georgia's reform efforts and confirms the country's continued commitment to the development of its capital markets.
"It will improve the investment climate, and we are grateful to the National Bank for our fruitful cooperation, and we look forward to working on many more exciting initiatives,'ť she said.
Governor of the National Bank of Georgia Koba Gvenetadze said that the purpose of the new law is to create the appropriate legal framework for the development of the derivatives market.
As reported, EBRD, under its Local Currency and Capital Markets initiative, is working on similar projects in Azerbaijan, Belarus, Egypt, Latvia, Morocco and Ukraine.
EBRD is a leading institutional investor in Georgia. Since the start of its operations in the country, the Bank has invested over 3.6 billion euro in 249 projects in the financial, corporate, infrastructure and energy sectors, with 89 percent of these investments made in the private sector.
---
Follow the author on twitter: @Mila61979356
---
ˆ©2020 Trend News Agency (Baku, Azerbaijan)
Visit Trend News Agency (Baku, Azerbaijan) at en.trend.az
Distributed by Tribune Content Agency, LLC.