Second Capital Market Development Program

An important aspect of CMDP II (Second Capital Market Development Program) was using a crisis as an opportunity to push reforms. This was reflected in CMDP II design that resulted in mutually reinforcing actions that simultaneously addressed the causes behind the crisis and expanded the financial sector to meet the needs of the real sector. In this regard, fundamental reasons for the crisis were the falsification of financial statements and the consequent exploitation of small investors. The accreditation system for auditors will help promote market information credibility. These actions provided mechanisms to restore investor confidence and encourage issuances and expanding products. However, the continuing weakness in the corporate debt market infers a lack of focus on issues related to market distortions and the absence of a recovery mechanism. Addressing these factors will fill gaps in the market and dovetail CMDP II achievements.