Corporate Securities and Derivatives Markets in Emerging Economy: Opportunities for Non-Financial Organizations in the Republic of Belarus

Abstract

The instruments of financial market provide an effective way to mobilize free funds of investors and manage market risks, which, however, isn’t fully used in Belarus. Some steps to improve the situation in financial sphere have been taken from the government side, but the area of corporate securities and derivatives still cannot be considered effective for all market participants. The aim of the research is to analyze the current state of corporate securities and derivatives markets in Belarus, identify problematic aspects and provide possible solutions for further development of those markets. For this purpose following research methods were used: analysis, synthesis, generalization, induction, deduction, observation, method of logical analysis, classification. According to the results of the study we have identified that corporate securities market, as well as derivatives market in Belarus, can be characterized by a significant role of the state in the creation process and high ratio of securities issued by banks and state institutions. In the article have been defined factors that constrain the development of those markets. Some factors lay in theoretical sphere, where have been proposed our own definition of corporate securities. Other factors arise in practical sphere: we have identified problems in accounting, taxation, legal regulation. For better understanding the necessity of hedging and its practical importance, we have considered the organization as an opened system, which is influenced by external factors. In this system, we have developed the model of hedging the most significant risks arising in the current activity of non-financial organizations.