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Saudi Arabia last country in the G-20 to open the stock market to foreigners
4/23/15
The board chairman of the Saudi Capital Market Authority, Mohammed bin Abdullah Al Jadaan, to allow foreign financial institutions eligible to invest in equities listed on the stock market, will make the Saudi market is part of a major global market, pointing out that Saudi Arabia, a member of the G-20 in the Council of «International Organization of Securities Commissions », was the last state in the major economies, which allowed foreign investors direct access to the capital market.
He told Jadaan yesterday that the Commission since its inception seeks to develop the Saudi capital market, and the decision to allow foreign investors direct access to contribute to it, through a number of targets in the short and long term, include the addition of specialized international investors experiences, and increased institutional investment in the market, according to ruled by the Commission strategy from 2015 to 2019. He added: «foreign investors specialists representatives in qualifying financial institutions, and is expected to contribute to the reduction of high volatility in prices, and will work to enhance the efficiency of the market and stimulate listed companies towards improving transparency and disclosure and governance practices level, and is expected to increase research, studies and assessments conducted for the overall market and listed companies, especially the level, giving dealers more accurate information fairer and calendars. »
For the licensees of individuals and institutions Jadaan said «This step will contribute to the growth of their business through this new segment of customer service, and will be accompanied by an increase in awareness activities and conferences various ad hoc financial investment in the Saudi market, and to raise awareness in the form of the financial market and investment ».
He stressed that the opening of the Saudi stock market to foreign investment in accordance with the rules governing it does not focus on bringing capital or pumping liquidity into the money market, the local market is not suffering from lack of liquidity, and the average value of trading which is within the accepted global averages. The Chairman of the Capital Market Authority that rules prepared by the Commission, which took into account the approval of the relevant systems in the UK, as well as it has been the introduction of specialists and general views of those who participated with their proposals in the 90-day period in which the Commission published draft rules.
It is noteworthy that the Commission will announce the rules governing the investment of foreign institutions qualifying on the fourth of May, which only allow the entry of large foreign institutional investors and relevant experience of countries that have regulations and legislation advanced, that those are the rules with effect from the first of June (June) and will allow qualified foreign investors to invest in listed stocks from 15 of the same month.
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