Abstract:
Capital market is the heart and soul of the financial sector. It is a vehicle whereby capital is deployed from sources where it is in excess to the sources where it is in short supply. The capital market facilitates;
(i) Mobilization and intermediation of private savings and
(ii) Allocation of medium and long-term financial resources for investment through a variety of debt and equity instruments of both private and public sectors.
It plays a crucial role in mobilizing domestic resources and in channeling them efficiently to the most productive investments. The level of capital market development is thus an important determinant of a country’s level of savings, efficiency of investment, and ultimately of its rate of economic growth. An efficient capital market can also provide a wide range of attractive opportunities for both the domestic and foreign investors. A modern and efficient capital market is the backbone of an economy. It plays a crucial role in mobilizing domestic and foreign resources, and channeling them to promote investment activities both for the short and the long-term periods. No country can prosper without developing its equity market.
