Amending capital market system allows establishing stock markets besides Tadawul: El-Kuwaiz
Amending the capital market law paves the way for establishing other stock markets besides the Saudi Stock Exchange (Tadawul), should they prove feasible and necessary regulations are issued, Mohammed El-Kuwaiz, Chairman of Capital Market Authority (CMA), said.
“The Capital Markets Authority plans to license other entities to provide activities of exchanges, depositories or clearing houses,” El-Kuwaiz noted, speaking at the currently-convened Euromoney Saudi Arabia 2019.
The Capital market Law was issued in 2003 to establish the market and the stock exchange. It was amended 15 years later by the Saudi Cabinet.
The law amendments focused mainly on investors protection and the development of the capital market.
The Saudi market attracted nearly SAR 76 billion worth of foreign investments.
Tadawul has rallied almost 6 percent year-on-year in the first half of 2019. However, the companies’ aggregate profit dropped nearly 30 percent YoY.
“Entry of foreign investors to the market, injection of funds, and increased demand have helped offset the recent drop in companies’ aggregate earnings,” El-Kuwaiz said.
These factors have helped the market players and the economy by large mitigate the transformation process in the last three years, he added.