BELGRADE (SeeNews) – Serbia has to make its business environment more transparent and adopt legislation covering takeovers and investment funds if it wants to attract big foreign players to its capital market, investors say. Insufficient financial information and lack of appropriate legislation that can secure the position of foreign investors and the lack of big companies listed on the domestic stock exchange were identified as major obstacles to the development of Serbia’s capital market at an international conference hosted by the Belgrade Stock Exchange. «What we need is transparency and detailed information,» said Aleksandar Vlahovic, president of EKI Investment consultancy. Companies in Serbia must introduce international accounting standards as soon as possible, because now foreign investors cannot rely on the information they receive and are unwilling to bring their money to Serbia, Bozidar Djelic, head of France’s Credit Agricole Group Central Europe, told a conference panel. Serbia also needs to adopt legislation that would ensure the growth of its capital market, investors said. The country has no law regulating the operations of investment funds, which is a major setback for its emerging capital market. «It’s necessary to adopt a number of laws to secure the further development of the market,» Vladimir Cupic, director of Austria’s Hypo-Alpe-Adria Bank’s Belgrade unit, said. «First of all comes the adoption of law on investment funds and voluntary pension insurance,» Cupic added. The Serbian Parliament is expected to adopt a law regulating the operations of investment funds by the end of the year. However, local analysts fear the bill could harm Serbia rather than help it develop its capital market because the draft allows domestic funds to invest their money abroad. The lack of attractive companies on Serbia’s capital market may force funds to invest their money abroad, analysts said. «It’s far from certain there is big room for pension, investment and mutual funds in Serbia,» Vlahovic told the forum. He added that the planned listing of power monopoly EPS, the state telecoms Telekom Srbije and the oil and gas monopoly NIS on the Belgrade Stock Exchange would boost the capital market. However, these companies must be restructured first, in order to attract foreign capital. «It’s encouraging for the Belgrade bourse that foreign investment funds are getting more interested in investing in smaller share issues, worth under 100 million euros,» Milan Elezovic, Corporate Finance Group Director of Nomura International, said. Only companies that are leaders in their sectors, like EPS, Telekom Srbije or NIS and two or three of the banks in Serbia, could be of real interest to big foreign players, Elezovic added. Serbia has yet to restructure and privatize EPS, NIS and Telekom Srbije. Shares of the three companies could be listed on the Belgrade Stock Exchange in several months’ time, a stock broker told SeeNews.