Annals of the University of Oradea: Economic Science (Dec 2011)
THE PLACE OF THE EMERGING ECONOMY OF ROMANIA INSIDE THE EUROPEAN UNION ECONOMIES IN TERMS OF FTSE CRITERIA
Abstract
The importance of this research lies from the need to know the economies developed, emerging and frontier of the European Union and the mode of their manifestation according to the market indicators. Consequently, we had in mind a presentation of the economies in the categories mentioned above framed in terms of market criteria used by FTSE Group, a provider of stock market indices and associated data services. Using data from a series of reports published by FTSE we made an analysis of how each of the considered economies and in particular Romania, acts according of these. Was taken into consideration criteria as: market and regulatory environment (formal stock market regulatory authorities actively monitor market; fair and non-prejudicial treatment of minority shareholders; non or selective incidence of foreign ownership restrictions; free and well-developed equity market; no objections or significant restrictions or penalties applied on the repatriation of capital; free and well-developed foreign exchange market; non or simple registration process for foreign investors); custody and settlement (settlement-rare incidence of failed trades; custody-sufficient competition to ensure high quality custodian services; clearing and settlement; stock lending permitted; settlement-free delivery available; custody-omnibus account facilities available to international investors); dealing landscape (brokerage-sufficient competition to ensure high quality broker services; liquidity-sufficient broad market liquidity to support sizeable global investment; transaction costs-implicit and explicit costs to be reasonable and competitive; short sales permitted; off-exchange transactions permitted; efficient trading mechanism; transparency); derivates (developed derivatives market). The final part of the paper is reserved to the understanding of the mode in which each of the considered economies of the European Union, including Romania and regardless of what category they belong (developed, emerging or frontier economies) behave in relation to the above criteria used by the FTSE in relation with the market quality. In terms of research methodology, this took into account the data collection through the observation method. This method use, as research tool, the observation guide. We have also had regard to the proper definition of the concepts and their operationalization in order to bring to the fore a number of relevant indicators for the economies of the European Union.
