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Official: Without Rule of Law, Stock Market Won't Fly

Cambodia may want a stock market, but without a strong rule of law, no one will buy into it, according to lawmaker Monh Sophan, a member of the government coalition party, Funcinpec.

The law aims to encourage investment through a stock market, a new concept to Cambodia that includes the printing of bonds for sale, Monh Sophan said Thursday on "Hello VOA."

The law, on issuance and trading, would pave the way for a stock market in the next two years. It was passed one week after the government announced it wanted to have a stock market by 2009.

A strong market requires investor confidence, something that Cambodia has a hard time generating.

The rule of law must be stronger before investors will entrust their money to a stock market or other securities, Monh Sophan said.

A non-transparent, non-neutral stock market will not succeed, he added.

Kang Chandararoth, a Cambodian economist, has said that a committee of nine leaders from various national agencies will have to keep politics out of the securities market.

"This is critical to its survival," he said recently.

Seventy-nine lawmakers voted for the law, which was based on international best practices, officials said. The law is awaiting final approval by King Norodom Sihamoni.