Saudi Stock Exchange: Ambitious Al-Ghamdi manages expectations

What’s in a name? Adel Saleh Al-Ghamdi is the chief executive of the Saudi Stock Exchange (Tadawul). The brackets are important. They are a sign of the increasing attention he and his institution are paying to the world outside Saudi Arabia.

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Asked how the opening of his markets to foreign capital will affect the exchange, Al-Ghamdi points out that Saudi is not totally isolated from the rest of the world. "It is worth noting that the Saudi capital markets, to a large degree, are already open to foreign investment flows," he says. "Indeed, the ETFs [exchange-traded funds] and mutual funds markets have no legal or regulatory restrictions inhibiting direct foreign investor participation."

Through these methods, foreigners – including those in the GCC, foreign strategic shareholders and resident foreign investors – already held 8.2% of Saudi Arabia’s market cap by June 2014, Al-Ghamdi says.

The new CMA rules, he says, "will simply serve to widen the access channel" so that foreign institutional capital joins those investors who have...