Prince Alwaleed urges opening Saudi market to foreigners

  • Share via facebook
  • Tweet this
  • Bookmark and Share

Saudi Arabian billionaire Prince Alwaleed bin Talal called on the kingdom's regulators to open up the stock market to foreigners and reduce its reliance on retail investors.

In a televised interview aired on 23 channels, the prince, who owns stakes in some of the world's top companies, said Saudi Arabia needed to upgrade its equity markets to international standards while protecting its blue-chip companies from hot international money.

"The Saudi market needs to rely less on individual investors. Saudi Arabia is 90-95 percent dominated by individual investors and 5 percent by institutions, opposite to what is there in America and Europe," bin Talal said.

"Yes there is concern about the hot money, but we can control foreign investors by, for example, introducing shares Class A or B and give access to 20 percent or 30 percent of the shares of each company," the prince said.

He added that Saudi Arabia had the right to protect strategic companies like Saudi Basic Industries Corporation (Sabic) from hot foreign money.

Foreigner investors can only buy Saudi shares through swap deals made by international investment banks, and via a small number of exchange-traded funds (ETFs).

Abdulrahman al-Tuwaijri, chairman of the Capital Market Authority (CMA), had said last year that the kingdom was planning to open up the market to foreign investors but that it should be done in an orderly and gradual manner to make sure it did not threaten market stability.

The CMA is considering allowing qualified foreign investors to take a capped share in each Saudi company, with international buyers able to own a total of around 20 percent of the market's value, according to proposals circulated to the financial industry last year.

Saudi Arabia's benchmark has risen 5.5 percent so far in 2013, and the economy is forecast to grow 4 percent this year, according to a Reuters poll in January. 

Related:
Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

Please post responsibly. Commenter Rules

  • No comments yet, be the first!

Enter the words above: Enter the numbers you hear:

All comments are subject to approval before appearing

Further reading

Features & Analysis
Taking stock

Taking stock

Gulf stock markets have seen a dearth of IPOs since the global...

Steering clear of the stock markets

Steering clear of the stock markets

Listing was all the rage three years ago, but IPOs have since...

Egyptians vent post-revolt fury in litigation

Egyptians vent post-revolt fury in litigation

Bankers, stockbrokers say indiscriminate corruption probes may...

Most Discussed
  • 54
    Three UAE women attacked with hammer at London hotel

    I really feel that Arabian Business.Com should now close this comments page. This should be all about sympathy for the families not what it is/has turned... more

    Wednesday, 16 April 2014 1:06 PM - Adrienne
  • 51
    Why Dubai isn't a plastic city

    What is definitely not a plastic city. The Arabs have a culture dating back to several centuries. 50 years back Dubai was just a fishing village. Today... more

    Tuesday, 8 April 2014 3:49 PM - P. MADHUSUDAN
  • 48
    DMCC boss Ahmed Bin Sulayem entertains Robert Mugabe in Dubai

    @fga ''However today, simply because he decided to dispossess a few white farmers of their land and redistribute to the poorer indigenous blacks'' more

    Sunday, 13 April 2014 3:02 PM - Matt Williams