||Regional Stock Exchange
In yet another effort to encourage investment in the Region,
Heads of Government agreed, at their tenth Meeting (1989, Grande Anse),
to establish a regional Stock Exchange which would bring together the Stock
Exchanges in the Region, namely the Barbados Securities Exchange, the Jamaica
Stock Exchange and the Trinidad and Tobago Stock Exchange. In 1991 these
three Stock Exchanges entered into an arrangement for cross border listing
and trading of securities (stocks/shares and or bonds). This would allow
the stocks/shares and or bonds on the stock exchanges in each of these
countries to be listed and traded in each others markets. As other countries
establish stock exchanges they too will be eligible to become members of
the regional stock exchange.
Stocks represent ownership in the company issuing the shares (the individual
units of ownership) while a bond represents a long term loan which must be repaid.
A stockholder is a part owner of the firm while a bond holder is a creditor who
has a claim against the company equal to the value of the bond. The claim of
bond holders rank higher than that of shareholders.
A Stock Exchange or Market is a meeting place for buyers and sellers of securities.
Though there are buildings housing national stock exchanges, there is no building
housing the Regional Stock Exchange. In this market, information is exchanged,
through a broker, regarding prices and volumes so that investors can buy or sell
securities at the best price. Anyone, be they CARICOM nationals or foreign investors,
may buy or sell securities on the Regional Stock Market.
In addition to providing greater regional investment opportunities and increase
the attractiveness of our Region as an area for investment both by regional and
non-regional investors, the Regional Stock Exchange is intended to: promote the
movement of capital across the Region and encourage the best possible financing
for CARICOM firms, regardless where the entity is located. The Regional Stock
Exchange also offers investors a wider market and greater choices in the selection
of investment options. Participating in the Regional Stock Market might give
firms a more cost efficient way of raising funds, rather than relying only on
the domestic market with its traditional banking network for such financing.
As the Region moves towards the Single Market and Economy, firms will need to
position themselves to meet the challenges and to take advantages of the opportunities
created by the wider market, not only for goods but also for investments. The
Regional Stock Market provides an excellent mechanism for the latter.