Saudi Arabia’s decision to open its bourse to foreigners has spurred a series of positive reactions among emerging market specialists.
The Kingdom will allow international players to trade shares on its bourse as of 2015 in order to lure foreign capital into the largest Middle Eastern market. Currently, the Saudi market is only open to domestic investors.
Opening the market may prompt the MSCI to re-classify Saudi Arabia as an emerging market, which could lead to as much as $40 billion of foreign cash entering the market, according to CityWire wesbite.
For her part, Ghadir Abu Leil Cooper, Head of EMEA and Frontiers Equity Team at Baring Asset Management, believes an open market will have a positive impact on Saudi Arabia's corporate governance.
She added that, in the future, Saudi Arabia will face challenges such as finding jobs for the work force, strengthening and deepening the economy and diversifying away from hydrocarbons and dependence on government funding. “To do this successfully will require attracting overseas investment, and having a fully functioning capital market goes hand-in-hand with that” Cooper said.
The Kingdom will allow international players to trade shares on its bourse as of 2015 in order to lure foreign capital into the largest Middle Eastern market. Currently, the Saudi market is only open to domestic investors.
Opening the market may prompt the MSCI to re-classify Saudi Arabia as an emerging market, which could lead to as much as $40 billion of foreign cash entering the market, according to CityWire wesbite.
For her part, Ghadir Abu Leil Cooper, Head of EMEA and Frontiers Equity Team at Baring Asset Management, believes an open market will have a positive impact on Saudi Arabia's corporate governance.
She added that, in the future, Saudi Arabia will face challenges such as finding jobs for the work force, strengthening and deepening the economy and diversifying away from hydrocarbons and dependence on government funding. “To do this successfully will require attracting overseas investment, and having a fully functioning capital market goes hand-in-hand with that” Cooper said.
Source:
Mubasher
