Securities and Exchange Commission (SEC) boss, Adu Anane Antwi, has proposed a raft of new measures that will boost capital market activities and inject local content into the industry. Speaking at last Saturday’s Investment Awards Night in Accra, he said the government must take actions including introducing a local-content policy for the market in order to increase participation and benefits for borrowers and investors. “Government should institute a capital market local-content policy that would require companies operating in specified sectors of the economy to float part of their shares on the Ghana Stock Exchange (GSE) after five years of operation. These sectors should include banking, insurance, mining, telecommunications, oil and gas, etc. This policy can be made part of the licencing requirements for such companies to operate,” he said. He proposed also that state-owned enterprises and statutory bodies be mandated to raise at least 25% of their loan/capital needs from the domestic bond market, and asked for tax exemption on interest and dividends paid to investors in listed bonds and equities. He said local authorities should begin to issue municipal bonds to raise money to finance their development plans, as happens in most developed economies. Selling bonds, however, would require localities to pick profitable projects and become more efficient in the use of their resources. “Well-resourced local government authorities like the Accra, Tema, Sekondi-Takoradi, Tamale and Kumasi Metropolitan Assemblies should be encouraged to issue municipal bonds to raise capital for their developmental projects.” Mr. Anane Antwi also tabled the idea of infrastructure bonds which the government could sell to finance the country’s significant infrastructure government would be considering infrastructure bonds sold with guarantees by the World Bank to pay for future projects. “To isolate borrowings for infrastructural needs from government debts, it is suggested that government seeks partnerships with international financial institutions to establish an Infrastructural Development Company that will issue infrastructural bonds to finance the nation’s infrastructural needs,” Mr. Anane Antwi said. A study sponsored by the World Bank in 2010 put the cost of fixing Ghana’s infrastructure deficit over the next decade at US$2.3billion annually. The study said the country is currently able to foot only about half of that gap, and the World Bank has supported public-private partnerships to raise additional financing to meet the full requirements. Mr. Anane Antwi’s proposals are also an attempt to seek diversification of the capital market, which the International Monetary Fund (IMF) described as “very concentrated” in a report on the stability of Ghana’s financial system that was published in May 2011. “The Ghanaian securities industry has not played a major role in resource mobilisation and long-term financing of the economy. Equities dominate the industry and the debt market consists predominantly of government securities, said the Fund’s report. It said though the industry has grown rapidly, the market lacks depth and liquidity -- in part due to low float. SEC is aware of the need for diversification and has completed work with the Ghana Stock Exchange for the introduction of Exchange Traded Funds (ETFs) on the stock market, Mr. Anane Antwi said. The Commission is also assisting the GSE to introduce the Ghana Alternative Exchange (GAX), a new smaller equities-trading market for the small and medium-enterprise sector. It is also developing rules for the operation of Real Estate Investment Trusts (REITs), which will strengthen the link between the capital market and the real-estate sector to improve housing delivery. To expand the agricultural/commodities market, SEC is presently collaborating with the Trade Ministry to set up the country’s first commodity exchange. Other plans include the establishment of a Securities and investment Institute to train personnel and improve professional standards among industry practitioners, and public education to expand awareness of capital market opportunities.