Qatar exchange's policies paves way for more liquidity, diversity

The Qatar Exchange (QE) managed to score a number of key accomplishments last month aimed at the improvement of the stock market in terms of offering more liquidity and diversity. The key accomplishment for the Qatar Exchange was the decision of MSCI to upgrade the Qatari market from a "Frontier Market" to an "Emerging Market," seen as a step that would attract more foreign investments to Qatar. Speaking to the Qatar News Agency (QNA), CEO of QE Rashid Bin Ali Al-Mansoori said that the upgrade would increase the confidence of investors that would possibly lead to the rise in liquidity from foreign investment portfolios by three billion Qatari riyals. (1QR equals USD 0.27). He indicated that the upgrade reflected the recognition on part of the MSCI to QE in terms of meeting the requirements for developing the market infrastructure and implementing a number of steps that made the market earns international recognition. The Qatar Exchange is one of the leading markets within the GCC and MENA regions with a capital of QR 512 billion, said Al-Mansoori, adding that the MSCI's recognition only bares testament to the huge strides achieved by the QE. With QE joining exchange markets of Brazil, China, India, and Turkey, Qatar would be opened to new opportunities and investments that would lead to less dependency on oil and natural gas, he said. He revealed that the Qatar Exchange had witnessed income by 12 percent since the beginning of the year, noting that the percentage was the highest on a global scale. On the second achievement by QE last month, Al-Mansoori said that the market had launched exchange on government bonds which are issued by the Qatar Central Bank (QCB) as of June 20th. He added that the step to exchange government bonds was the first stage of launching a companies' bonds market that would capitalize on the economic growth witnessed in the country. Al-Mansoori indicated that exchanging of government bonds would lead to the development of the finance market as well as diversifying the investment opportunities provided to banks, financial institutions, and investors. Investments in the bonds market had become one of the financial attractions to major companies as well as investors, said Al-Mansoori, noting that governments, companies, and institutions were keen on providing liquidity for its projects through their involvement in bonds exchange. QE's introduction of government bonds exchange would provide governments, companies, and investors with an alternative source for funding, said the official. Al-Mansoori said that the Qatar Exchange launched in the beginning of this year a market for small and medium size companies, stressing that the development of such enterprises was integral for Qatari economy. He revealed that the shares of small and medium size companies were exchanged within the main index of QE; however, the market for such companies are governed by different rules that regulates exchange and listing of small and medium size companies. The CEO of the Qatar Exchange also touched on the subject of family owned businesses and companies, noting that around 90 to 95 percent of companies in the GCC were under this category. He said that it was important to acknowledge the influence of family owned companies, adding that it was important to list companies of such nature in the market. Al-Mansoori also touched on the establishment of QE Al-Rayan Islamic Index which deals with shares according to Islamic sharia. He indicated that the launched of the index was to encourage Islamic oriented financing and further develop the diversity of the market. The Qatar Exchange (formerly the Doha Securities Market) is the principal stock market of Qatar. The market was founded in 1997 and is located in the capital city of Doha. Its name is abbreviated to DSM. NYSE Euronext owns 25 percent of DSM. The market currently has 42 listed companies.