Central and Eastern Europe and Russia have been actively building capital markets since the beginning of the transition period in 1990. Since that time, these countries have created or re-established equity markets and actively developed government securities markets. In some cases, corporate bond markets have also begun to flourish. Yet, many problems remain in achieving desired levels of efficiency, transparency and stability.

For the first time, the evolution of both equity and securities markets in these countries is critically evaluated. The policy choices for promoting these objectives and further integration of the fledgling markets into the international capital markets are discussed, although they are not always straightforward and free of controversy.

This book brings into focus some of the main obstacles on the road to building sound capital markets. Financial experts, economists from OECD member countries as well as government officials from several central and eastern European countries and Russia describe strategic choices and policy options based on their experiences with different privatisation methods, regulatory approaches and government debt management policies. The presentation of actual experiences and policy challenges encountered by government officials in creating and regulating securities markets -- in particular, very frank accounts by Russian and Czech officials of attempts to combat fraudulent practices of certain market participants -- makes this book unique.

The range of lessons found here will provide support for countries currently in market turmoil and insights on the process of building capital markets for policymakers, academics and market participants.