CAPITAL MARKET DEVELOPMENT IN A SMALL COUNTRY

 
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
A capital market is a complex institution comprising of regulators, facilitators, issuers and investors.  It is the mechanism through which long term funds for households, firms and government are polled and made available to various sectors of the economy, including transfer of instrument already outstanding.  The capital market on the other hand, deals with long term financial claims and obligations.  It provides the necessary facilities for users and supplier of capital (Longterm) funds to interact for their mutual benefit.  Hence most financial activities which are necessary in the investment process are consummated in that market.  Capital market instruments have long-term maturity.  Some like equity stock have indefinite maturity dates.  In general, all financial transactions which involve maturity periods of over three years could be presumed to belong to the capital market it also has no confined place for its operation however, parts of the market are concentrated in