Political Risk Latin America Blog @PolRiskLatam

The Benefits of MILA

Posted in News and Articles, Political Risk by politicalrisklatam on November 19, 2010

by a Chronicle Special for Latin Business Chronicle, November 19th, 2010.

The integrated stock exchange of Chile, Colombia and Peru is larger than Mexico’s.

On November 22, the stock exchanges of Lima, Peru (the BVL); Colombia (the BVC); and Santiago, Chile (the BCS) will make their shares available to investors in all three countries. The first stage in the integration will facilitate technological access to the local market for foreign intermediaries. The exchanges will remain separate legal entities that function and operate independently.

The idea is to provide investors with a broader supply of shares and share issuers with additional sources of financing. “In theory, the integration of stock markets enables the interchange of capital flows between the markets in a way that is much more expeditious,” says Jaime A. Retamal Smith, director of the MBA program of the Gabriela Mistral University in Chile.

“This integration will enable any citizen in these countries to invest in a particular market as easily as he or she does in their own country of origin. In this context, one would expect that small investors, who previously were unable to find such diversification because of problems of scale, could now do so perfectly.” Retamal says the initiative “is appropriate and will have a positive impact over the medium and long term.” Diana P. Piedrahita, coordinator of the financial laboratory at the EAFIT University in Colombia, calls the integration “an enormous step for deepening the markets of the region.” (continue reading… )


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