Have you considered the burgeoning opportunities in Saudi Arabia’s capital markets? With remarkable achievements in foreign investment and sukuk funds, the Kingdom is positioning itself as a lucrative destination for global investors.
Saudi Arabia’s Impressive Financial Milestones
Saudi Arabia’s financial landscape is witnessing transformative growth, highlighted by the Capital Markets Authority’s recent report. The Kingdom successfully raised a staggering SR29.95 billion ($8 billion) through sukuk and debt instruments, while foreign investments soared to SR198 billion. These accomplishments reflect the dynamic changes aligning with the ambitious Saudi Vision 2030.
In 2023, the CMA implemented new regulations, increased market listings, and enhanced global financial rankings, showcasing the Kingdom’s commitment to financial excellence. Mohammed El-Kuwaiz, chairman of the authority, praised these achievements and the collaboration with the Financial Sector Development Program in driving these successes.
Emerging markets, particularly in the Middle East and North Africa, are experiencing a resurgence, with global investors drawn by attractive returns and comprehensive market reforms. The CMA’s initiatives in adopting best practices and digitalizing trade processes have significantly bolstered liquidity in the region.
Revolutionizing the Sukuk and Debt Market
The Debt Market Development Strategy has been a pivotal force in Saudi Arabia’s market evolution. By eliminating its share of trading commissions on sukuk and bonds, the CMA has stimulated secondary market activity, pushing the sukuk and debt instruments market to 18.3 percent of GDP.
In 2023, 70 sukuk and debt instruments were listed, generating SR29.95 billion, with substantial contributions from private placements. The corporate sukuk and debt market reached SR125 billion, with tripling numbers of issuing companies since 2019.
The last quarter of 2023 saw a 2.8 percent rise in sukuk and bond issuances, fueled by government-issued instruments. This surge has translated into increased market activity, with traded values reaching SR2.5 billion and a significant rise in individual investor participation to 12.5 percent.
Surging Foreign Investments and Global Rankings
Saudi Arabia’s capital market continues to attract foreign investors, with net foreign investments reaching SR198 billion in 2023, a 7.7 percent increase from the previous year. Foreign investor ownership now stands at SR401 billion, reflecting growing confidence in the Kingdom’s market stability.
Market listings have also seen substantial growth, with 43 new listings in 2023, a 79 percent increase over targets. This includes diverse listings across the main and parallel markets, further diversifying investment opportunities.
Globally, Saudi Arabia’s capital market achieved impressive standings, ranking first among G20 countries in the Board of Directors Index and securing second place in several key indices. These achievements underscore the Kingdom’s strides in governance, market accessibility, and investor protection, cementing its competitive edge on the global stage.
Saudi Arabia’s commitment to enhancing its financial markets presents a compelling case for investors seeking to tap into a region poised for unprecedented growth and opportunity.
