The changes introduced by the market regulator mean the abolition of the concept of Qualified Foreign Investor. So far, only selected investors with access to the Saudi capital market could engage in investments. Now the market will be opened to all investors around the world, which is expected to support capital inflow and increase trading liquidity on the Saudi stock exchange.
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New opportunities for foreign investors
According to a statement by the Capital Markets Authority, the new regulations are intended to facilitate investing in Saudi Arabia's capital market, which is part of the country's broader economic plan. For several years, Saudi Arabia has been striving to make its economy independent from oil, implementing a number of reforms and initiatives aimed at attracting foreign investors.
One example of such activities is cooperation with partners from Japan and Hong Kong in launching ETF funds. Last year, foreign investors also introduced the possibility of purchasing shares of companies owning real estate in Mecca and Medina. However, restrictions on direct land ownership in these cities remained unchanged.
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Increase in the value of Saudi shares and the participation of foreign investors
Last September, the value of Saudi shares rose significantly amid reports of a possible easing of limits on foreign investors' shareholdings in listed companies. Currently, international investors hold assets worth 590 billion riyals, equivalent to $157 billion, in the Saudi capital market, the Capital Markets Authority reported.
Saudi Arabia hopes that the new regulations will further increase the interest of foreign investors and strengthen the country's position on the global financial market.
