“The last few years have been a period of progress, but we are far from where we want to be.” With that phrase, Andrés Restrepo, general manager of the Colombia Stock Exchange (BVC) and corporate markets manager at nuam, summarized the dilemma facing the Colombian capital market.
According to the executive, there are signs of recovery, greater investor interest, and new financing possibilities, but obstacles still persist that prevent it from playing a much more significant role in the growth of the economy.
When asked what the market really needs to take off, Restrepo was emphatic in pointing out that there is no single measure that alone can produce that leap. What is required, he said, is a combination of factors ranging from restoring and maintaining confidence to reviewing regulation, tax incentives, liquidity, and the conditions faced by those seeking funds and those wanting to invest.
“Since this is a market and, therefore, has so many participants in so many roles, there is no answer where I can say: if this happens, this will be unleashed. It is a conjunction of elements,” he explained during a press conference prior to the academic agenda of the Asobolsa-nuam Congress, held in Cartagena.
One of these is confidence. Restrepo considers the change in perception regarding investment and the market fundamental, although he warns that this is not enough. The country, he noted, must ask itself if it has the structure and number of participants it needs and if the existing incentives truly encourage the arrival of capital.
Among the issues he raised is precisely the tax one. According to the executive, there are cases where companies listed on the stock exchange may face effective tax rates close to 40 percent and their shareholders end up bearing a burden that can approach 60 percent.
However, he does not suggest that reducing taxes is the solution to unlock the market. His argument is that every tax, regulatory, or corporate governance decision can end up affecting its development and, therefore, the issue should be addressed as a permanent strategy.
State Policy
Shenny González, president of Asobolsa, agrees that one of the main problems has been addressing these obstacles in isolation.
“It is not the only acetaminophen for the headache,” she said, pointing out that the country needs a public policy “clear, long-term, executable, with monitoring and measurement.”
For González, issues such as the behavior of the dollar, the valuation of the peso, taxes, and financing conditions end up influencing a company’s decision on whether to turn to the capital market or seek, for example, a bank loan.
In that direction, she believes that the work carried out in previous initiatives that brought together different actors around market development should be resumed and organized. The priority now would be to refine the numerous existing proposals, establish which are truly critical, and set a schedule to implement them.
“The capital market has to be a long-term State policy,” is essentially the message left by both leaders.
New Issuers
Another challenge raised by both executives is to expand the list of companies that use the market to finance themselves.
Restrepo considers it strategic that not only the largest companies see the stock exchange as an alternative, but also medium-sized companies that need resources to grow. To achieve this, he proposes developing a “growth market,” that is, a segment with particular conditions that allows smaller companies to join gradually.
The idea is that they do not have to meet from the outset the same liquidity and information requirements as the largest companies in the country, but that they can follow a progressive path until reaching the main market.
As a reference, he mentioned the experience of a2censo, where some companies started with small financing campaigns and then increased the amounts raised until using more sophisticated instruments.
Restrepo believes that this gradual approach is more realistic than expecting that “overnight” a small company competes in the same segment as a company the size of Ecopetrol.
Integration in 2027
Part of the bet to give greater depth to the market lies in the integration of the stock exchanges of Colombia, Chile, and Peru through nuam.
The process has advanced in the infrastructure used by the three countries. Today they operate with the same matching engine, the same trading screen, and, according to Restrepo, about 95 percent of the operating rules are already harmonized.
The next stage is focused on post-trade, that is, on making everything that happens after an investor buys or sells a security simple so that the operation is effectively paid, settled, and fulfilled.
The goal remains to have the equity market integrated during 2027, although regulatory and technological tasks remain. In Peru, for example, the figure and entity that will function as the central counterparty must be created, while in Colombia issues related to direct access for operators and currency discussions with the Bank of the Republic remain pending.
“The objective is not to have a common platform. The objective is to have a truly vibrant integrated market,” emphasized Restrepo.
For an investor, the change would mean being able to access from Colombia, Chile, or Peru a much larger offer of companies and sectors, diversify their portfolio, and acquire assets in local currency or dollars.
Individual Investors
The other front that could help deepen the market lies with small investors. Although their participation is still relatively low, Restrepo assured that their growth over the last five years has been significant.
Digital platforms, the possibility of starting with small amounts, and greater access to information about companies and markets have reduced barriers that until a few years ago made it difficult for an ordinary person to enter the stock market.
González, from Asobolsa, pointed out that today there are alternatives that allow starting to invest from 50,000 pesos and even investment funds that accept smaller amounts. But she warned that technological access must be accompanied by financial education.
In the end, for Restrepo, success should not simply be measured by how much trading on the stock exchange increases. The real goal is to ensure that the market efficiently connects investors’ savings with the companies and projects that need resources.
“The goal we have as a capital market is to be a source of financing for the productive projects of this country,” he stated. And he summarized it even more forcefully: “If we achieve that, we have been successful. If not, we lost the year.”
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