Saudi regulator finalises foreign ownership rules

  • Share via facebook
  • Tweet this
  • Bookmark and Share

Saudi Arabia is finalising a regulatory framework which will allow foreigners to directly own stocks in the kingdom, though the market has no need for liquidity from international investors, the head of the country's market regulator said.

"There are a number of government entities, including CMA, that are looking at that (direct foreign investment). We're finalising a regulatory framework with certain parameters," Mohammed bin Abdulmalik Al al-Sheikh, appointed head of the Capital Market Authority in February, said on Tuesday.

"We are attracting foreign investment to come to the market for the technical expertise and human capacity," he said without giving any time frame for the reform, which officials have been considering for years.

Currently, foreign investors can only buy shares in the largest Arab market through swap deals involving international investment banks, and via a small number of exchange-traded funds.

The regulator is also trying to limit "high levels of speculation" in the stock market, Al-Sheikh, previously a World Bank official, said on the sidelines of a conference.

"The CMA should put a limit on this manipulation to safeguard investors. We are currently trying to address this issue."

Al-Sheikh said the CMA and other government bodies intended to encourage institutional investment in the market by diversifying investment instruments and funds, including sukuk (Islamic bonds) and other debt tools.

"CMA is developing a strategy to promote institutional trading on the tadawul," he said, adding: "While out of the total 47 billion stocks listed 45 percent are held by individuals, nearly 93 percent of daily trading is done by retailers."

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
Risky business

Risky business

Libya’s stock market is one of the smallest in the Arab world...

'The gold rush is over'

'The gold rush is over'

Many blue chips are reviewing their emerging-market strategies...

Money talks for Gulf SWFs

Money talks for Gulf SWFs

The Gulf’s oil-rich sovereign wealth funds are seeking to increase...

2
Most Discussed
  • 15
    Germany puzzled as UAE think tank ordered to close

    Matt, your words sound kind of funny given the role the Britain has played in this region for so many decades.
    And given the democratic tradition that... more

    Thursday, 17 April 2014 7:10 PM - one of the joes
  • 10
    UAE father who whipped son to death wins appeal

    "Under Sharia, a parent cannot be executed for killing their child"
    A spouse could be executed if he/she kills his/her spouse, as none of them is... more

    Friday, 18 April 2014 3:38 PM - Nihar
  • 3
    To diet or not to diet?

    It is best to eat by your blood type. Following this diet is miraculous. Generic diets don't always work as certain foods are not good for the individual... more

    Friday, 18 April 2014 11:49 AM - Shamira Mitha
  • 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