2017: Journal no. 3

BASIS FOR THE DEVELOPMENT OF THE LIQUIDITY OF THE GOVERNMENT SECURITIES MARKET IN THE REPUBLIC OF MOLDOVA

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Authors:  
Victoria COCIUG, Associate Professor, PhD, National Institute for Economic Research, Republic of Moldova
Olga TIMOFEI, PhD, Senior Researcher, National Institute for Economic Research, Republic of Moldova

The unilateral structure of the domestic financial market, monopolized by banking institutions,requires a major reconfiguration by returning to representative positions of the capital market. Thisrestructuring can be initiated by increasing investors’ interest in the government securities market, givingit some quality elements, but also by creating a trading system that would increase the liquidity of allsecurities on the capital market. Increasing the quality of the GS market would allow the government on theone hand, to diversify its funding sources and manage its most important market risks more effectively, andon the other hand the financial sector would create opportunities for it to correlate and synchronize thedevelopment of the GS market with other segments of the capital market. In order to identify prerequisitesfor the development of the GS market in the RM, using the methods of research analysis, synthesis anddeduction, we initially sought to identify the characteristics that define a market of government securitiesas a qualitative one. A comparative analysis of the historical evolution of government securities markets,which can be considered representative for the Republic of Moldova, can provide the necessary experiencefor the improvement of the liquidity level of the domestic government securities market. The results of thisresearch have identified several possible actions, the implementation of which could lead to an increase inthe quality of the domestic GS market.

Keywords:  
government securities, government securities market, liquidity level of government securities market