A recent report has revealed that Saudi Arabia is taking steps to enhance its appeal to foreign investors in its stock exchange. The country aims to achieve 17 percent ownership of free float shares by 2024. The Saudi Capital Market Authority (CMA), as outlined in the 2023 Financial Sector Development Program document, has set a target of increasing assets under management to 29.4 percent of the gross domestic product by 2024. This will be accomplished by improving the investment environment and attracting more investors.
The report, which is published annually, highlights the Kingdom’s progress in the financial sector, particularly in competitiveness indicators related to the capital market. Mohammed Al-Jadaan, Saudi minister of Finance and chairman of the Financial Sector Development Program, emphasized these achievements.
Read more: Saudi CMA’s locally managed assets surge to $232.2 billion in 2023
To facilitate financing in the capital market, the CMA plans to expedite the listing process by welcoming 24 new companies in 2024. Additionally, there will be a focus on supporting the development of new and promising sectors, with a goal of having micro and small enterprises account for 45 percent of the total listings.
The CMA also aims to deepen the sukuk and debt instruments market. By the end of 2024, the target is to increase the debt-to-GDP ratio to 22.1 percent. These measures are intended to provide diverse financing options for companies and further stimulate economic growth.
Al-Jadaan underscored the significance of innovation and investment in talent and technology when discussing the progress of the financial sector. The minister stated that the authorities have prioritized these areas to foster a dynamic financial environment that enables the growth and success of companies, particularly startups.
Facilitating foreign investment in securities
Mohammed El-Kuwaiz, chairman of the CMA, acknowledged the efforts of the capital market ecosystem in contributing to the development of the financial sector and the achievement of the Saudi Vision 2030. He highlighted the approval of rules for foreign investment in securities and the streamlining of regulatory procedures, which have resulted in a noteworthy increase in foreign investments in the capital market. The total foreign investments reached SAR401 billion ($106.9 billion), according to El-Kuwaiz.
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