ABSTRACT
The increasing appetite for capital markets in developing economies The role and place of capital markets in economic development have received increasing attention in recent times. It is believed that there is a strong correlation between the level of development of capital markets and the level of economic development of their respective country or economic region.1 Roth2 succinctly summarised this view as follows:
A well-developed capital market facilitates the capital formation that is essential to economic growth. Effective use of domestic savings allows many domestic enterprises that are unable to attract foreign capital to obtain needed capital from domestic sources. Moreover, foreign companies that find it possible to raise capital in the local market of a developing country are encouraged to establish new or expand existing operations in that country thereby making their products available without expenditures of foreign exchange.
