Thursday 17 October 2013

Jordanian government intervention to solve the crisis stock

Accumulate a significant proportion of the wealth of Jordanians in Amman financial market , and resulted in a significant drop in the market value of shares of listed companies , as a result of the negative effects of the global financial crisis and the subsequent different crises , to the loss of investors, a significant proportion of their wealth and savings. These losses were reflected on investment and consumption and led to an increase in poverty and unemployment , in addition to various social problems .
The indicators improved the performance of many regional and global markets , especially during this year , still the Amman Stock Finance and the fifth consecutive year suffer a decline in the level of confidence of investors Jordanians and non-Jordanians, which led to a steady decline in market indices , namely the value of trades daily , which fell by more than 90 percent from their levels before the onset of the crisis .
And reflects lower trading usually high level of risk as investors resorted to less risky instruments , namely deposits , so he continued growth in the volume of deposits in Jordanian banks and market ceased to provide funding to existing public shareholding companies or modern incorporation.The total funds paid by the shareholders of existing companies as a result increase their capital in order to expand and spread and strengthen working capital between 2005 and 2008, about 3.5 billion dinars ( $ 4.9 billion ), while the value of the funds collected from subscribers in the shares of the modern corporation established around 1.5 billion dinars.
The shape of this huge amount and value of nearly five billion dinars, a significant proportion of loans provided by the banking sector during that period to investors in various economic sectors, what was considered an important indicator to rely on the market to fill an important part of the financing needs of economic sectors in light of the difficulty of the availability of capital sufficient appropriate to the conditions and costs of long - term investment as banks prefer to finance short and medium term , considering that its financial benefits , namely deposits , usually between the short and medium term .
And contributed to the funding provided by the market an effective contribution to the strengthening of economic growth and employ hundreds of thousands of job seekers , in addition to the contribution of the shareholders 'funds of non - Jordanians to increase companies ' capital to strengthen the balance of payments and the country's reserves of foreign currency.The resulting stop market for funding to limit the activity on the transfer of ownership of shares of an investor to another and consequently lost market an important part of its investment , economic and financial , at the time worked when most countries in the world all in its power to restore the role of financial markets through a variety of means and policies and mechanisms , financial markets are a barometer of economic conditions and financial, investment, political and security , they reflect the reality and expectations, as can be judged through the market indicators on the reality of the situation as a whole .
And reflect market indicators Amman Financial limited confidence in the economic and financial situation and investment , political and security , and therefore does not need to develop appropriate mechanisms to promote this trust, lies with the economic team in the government responsible for the formation of a dedicated team includes regulators as a whole, at the forefront of the Securities Commission and the Central Bank , in addition to the Association of banks ( in light of the stresses of banks to grant loans to investors and the public shareholding companies ) and private sector representatives , brokers and investment firms and other relevant authorities to come out with recommendations and perceptions contribute to the return of confidence to the market and solve the crisis .

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