Directors of bourses in the six-nation Gulf Co-operation Council (GCC) met in Riyadh on Sunday and decided to set up five committees that will be entrusted with unifying bourse laws and legislations ahead of integration.
"We have created five committees that will work for the integration of GCC stock markets by unifying existing laws and regulations," said Mohammed Al Mazroui, GCC's Assistant Secretary-General for Economic Affairs.
"These committees cover securities, bourse linkage, IPO issuing, stock registration and disclosure, and share listing," Mazroui told the Saudi Arabic language daily Okaz after the meeting in the Saudi capital, Riyadh.
They will then present proposals to the ministers of economy, who, in turn, will submit a final plan to the GCC heads of state.
"These committees will focus in the next period on how to bridge the procedural gap in the GCC stock markets... the ultimate objective is to achieve integration and benefit all citizens in member countries," Mazroui said.
Final proposals are expected to be submitted to the GCC leaders when they hold their annual summit just before the end of the year, they added.
"Integration of the GCC bourses has been approved by the GCC heads of states as part of the common market," one source said. "This plan aims to ensure all GCC citizens have access to the stock market in any member without any discrimination... they should be given equal treatment as nationals."
GCC states - the UAE, Saudi Arabia, Kuwait, Qatar, Bahrain and Oman - launched a common market at the start of 2009 following the creation of a customs union.
The projects are in line with a landmark economic pact they signed a year after they established their economic, political and defence alliance in 1981.
With the exception of the UAE and Oman, the other members are pushing ahead with the historic monetary union, but officials have indicated the door remains open for those two members to rejoin at a later stage.
At the end of the closing session on Thursday, the combined market capitalisation of the GCC bourses stood at $659.3 billion (Dh2.42 trillion), more than 80 per cent of the total Arab market capitalisation.
Saudi Arabia's Tadawul remained the largest bourse in the Middle East, with a market capitalisation of about $337.1bn. The UAE has the second-largest bourse, with a capital of $110.8bn.
Given their growing links with international markets, the GCC stock exchanges have been worst hit by oil price fluctuations, the repercussions of the 2008 global fiscal distress and the euro zone crisis.
Market capThe GCC market cap as at June 17:KSA - $337.1bnUAE - $110.8bnKuwait - $96.4bnQatar - $83.3bnBahrain - $16.1bnOman - $15.6bn
Source: Official data
By Nadim Kawach
© Emirates Business 24/7 2010
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