BAKU, Azerbaijan, December 30. Azerbaijan ranks
highest in the capability pillar, and second behind China in the
technology pillar in the CAREC Country Rankings for Capital Market
and Fintech Development, said the Asian Development Bank (ADB),
Trend
reports.
"These facts imply that Azerbaijan could rapidly boost capital
market development using its potential in fintech technology and
its regulatory and business capabilities. Fintech could be
leveraged to improve traditional capital markets and introduce
alternative financing platforms," reads the latest report released
by the Bank.
The ADB analysts believe that Azerbaijan is expected to show
leadership by making full use of its potential, as shown in the
technology and capability pillars, for capital market
development.
"Areas of leadership could include the regional fintech
passport, regional regulatory sandbox and collaborative regional
fintech community, regional harmonization of digital ID
regulations, and cross-border payments using distributed ledger
technology (DLT) and similar systems," the report reads.
ADB notes that regional cooperation is needed to accelerate
capital market development in the CAREC region.
"It is an optimal strategy for speeding up regional financial
integration, as it would create wide and deep capital markets in
which firms could choose the most efficient sources of funding and
investors could simultaneously choose the most productive
investment opportunities. Regional cooperation is also needed to
cope with the potential risks of financial globalization and
regional financial integration. Regarding regional
fintech-cooperation strategies, this chapter has focused on
regional cooperation for payments and remittances, capital market
integration, and cross-border fintech regulation and
supervision.
It should be recognized that capital market development is a
difficult goal that can only be achieved through continuous policy
efforts across various areas. Although the goal can indeed be
better approached through fintech and regional cooperation, changes
are likely to occur more slowly than would be ideal, due to
structural and immutable constraints. Therefore, policy authorities
need to take a step-by-step and strategic approach guided by a
comprehensive, well-structured plan that may take a decade to
complete for some countries and as much as 2 decades for others,"
the report reads.
