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Opinion

The lessons of Jammaz Al-Suhaimi's demise

Saudi regulator leaves a positive legacy for his country’s financial markets.

There’s plenty of simmering outrage in Riyadh financial circles over the dismissal of Capital Markets Authority chief Jammaz Al-Suhaimi, the highly regarded regulator who has striven to clean up the Saudi stock market. But the decision of the authorities to sacrifice him is hardly a surprise.

In emerging countries like Saudi Arabia, a battle always rages, sometimes unseen, between four forces seeking to control the markets: the public chasing easy money; the government pursuing complex goals, here including wealth distribution; the regulator trying to impose order; and the manipulators, the wealthy and politically well connected who treat the country and its markets as their own.

In Saudi Arabia, maybe two dozen families really know what drives the market and they dominate it.

The stock market crash in Saudi Arabia has unfolded against the backdrop of a fierce battle between the regulator and speculators, with the public feeling cheated and baying for blood. The authorities were always going to have to offer up some sacrifices to an aggrieved population. At one point, rumour even suggested that the job of the finance minister himself, Ibrahim Al-Assaf, might be at risk.

So was it to be the regulator, or the speculators? How about both? Of course, the authorities should have punished only the manipulators and backed the regulator.

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