MUSCAT -- Arab countries are looking at integrating their stock markets in an apparent move to enhance smooth flow of capital among the member states. A union of regulating authorities in Arab countries called Arab Capital Market Union was formed recently to integrate the stock markets, Yahya bin Said al Jabri, Executive President of the Capital Market Authority (CMA) told the Observer.
"More than ten countries participated in a recent meeting of the forum. We will use the forum to integrate the markets," Al Jabri added on the sidelines of a forum on 'Integration of Arab Capital Markets: Prospects and Challenges'. Al Jabri said the regulating authorities would look at various issues related to legal, technical, trading and training. "We will come out with practical solutions on various issues at the concluding session," added the CMA chief.
Common regulations in member countries will ease difficulty in applying for initial public offerings (IPOs), he said, adding that investors faced hurdles in recent months for applying for share offers. The three-day-forum was organised under the auspices of Mohammed bin Nassir al Khusaibi, Secretary-General at the Ministry of National Economy. It will discuss on various issues, including advantages of integrated capital markets in the Arab region, impact of globalisation, privatisation and investor-friendly legislation.
Al Jabri also said that the integration of bourses would enhance efficiency and the capital markets in the region will be in a better position to attract foreign investment. "Integration of stock markets in the region was more difficult a few years ago. But the latest technological advancement made flow of capital more fast," he noted. "We can use technology as a base for creating a large market," Al Jabri added.
Al Jabri noted that the CMA has been focusing on introducing modern technology. The regulating authority has introduced new transparency norms, corporate governance as well as international standards. The objectives of CMA have always been to achieve progress towards the full integration with Arab capital markets, especially GCC bourses.
CMA has been taking earnest efforts to open up the Omani market to attract investment from regional and international investors. Dr Mustafa Hudaib, Head of Arab Financial and Monetary Sciences Academy, said that the international capital markets are witnessing developments, which require organisational and technological restructuring among Arab bourses. These changes are accompanied by privatisation efforts and economic reforms. The world is moving towards the implementation of international accounting standards and adopts new corporate governance norms.
There were three sessions on the first day of the forum. The first session was on how Arab capital markets could be integrated and the impact of globalisation and technology, the second session dealt with the issue of privatisation in Arab capital markets and the third was on the investment climate and raising public awareness on prevailing regulations.
Maqbool bin Ali Sultan, Minister of Commerce and Industry, Hamoud Sangour al Zadjali, Executive President of the Central Bank of Oman, Shaikh (Dr) Abdul Malik bin Abdullah al Hinai, Under-Secretary for Economic Affairs at the Ministry of National Economy and Nasser bin Khamis al Jashmi, Under-Secretary at the Ministry of Oil and Gas, have attended the forum.
Market regulators from the region, senior officials from brokerage and investment companies, banks, insurance firms, auditing companies and legal experts from the region also participated in the forum, which was organised by Arab Academy for Banking and Financial Sciences in association with the Capital Market Authority.
By A E James
© Oman Daily Observer 2007
