IOSCO identifies the key regulatory and supervisory challenges currently facing 'emerging Markets’ securities regulators, and sets out the recommendations needed to address these challenges.
The responses to the consultation suggest that the impact of the current crisis on emerging markets has manifested itself in different ways, depending on a number of factors relating to the depth and development of the various capital markets. Nonetheless, these trends are indicative of the extent to which emerging markets as a whole have become much more integrated within the global financial system, and therefore may be increasingly exposed to systemic risk and shock transmission in turbulent times.
Furthermore there is a need for greater global inclusion of emerging market authorities on regulatory matters, from standards setting to global supervisory activities, as well as a need for greater information sharing among regulators. The pronouncement of the G-20 Summit on 2 April 2009 may serve to focus the manner in which not only emerging markets, but all securities markets respond to the current crisis.
Finally, the Report findings also highlight the need to strengthen regulatory and investor protection frameworks, as well as effective prevention and management of systemic risks and instabilities in the emerging markets. IOSCO, in particular, may play a larger role in facilitating necessary technical assistance and training programmes in key areas such as market surveillance, intermediary supervision and systemic risk assessment, as well as through forming specific task forces to undertake thematic work.
© IOSCO
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