As Saudi Arabia prepares to open its stock market to wider foreign investment possible as soon as April 2015, there is tremendous enthusiasm on the part of foreign investors as wells as anticipation within the Kingdom. In a recent FocusKSA discussion with Dr. John Sfakianakis, SUSTG’s President Richard Wilson asked about the importance of the opening in the broader context of Saudi Arabia’s economic goals.
“I think its very important…It’s the part that was missing when people talk about the financial sector in Saudi Arabia, the bit missing from all those who were saying within the G20 everyone can invest directly in everyone else, except in Saudi Arabia,” Sfakianakis said, calling the decision “monumental.”
Sfakianakis noted that it is critical for two broad reasons, the first being size. With more than $500 billion, the Saudi stock market is larger than South Africa’s and towers over other emerging markets.
The second is that, eventually, the opening will pave the way for Saudi Arabia’s market to join the MSCI index bringing with it additional benefits such as market depth, stability, and transparency. “I don’t expect it will take long for that to happen,” Sfakianakis said.
“The market has huge potential once we get over the current correction period,” he added, referring to a significant drop in the market of late as a result of falling oil prices.
To see the full interview, click here.
