Saudi govt program seeks to modernize capital markets

The Saudi government-sponsored, Financial Sector Development Program 2020, targets a radical modernization of the Kingdom's capital markets through a number of initiatives. The program's initiatives include, but are not limited to:

- Encouraging the privatization of some state-owned services and entities. Such assets will be determined by Saudi Public Investment Fund (PIF), along with other entities.

- Introducing regulations related to debt market to deepen the market and diversify options for the public and private sectors. Saudi Arabia's public debt reached around nine percent (SAR 213 billion) of GDP in 2016, and is set to hit 15 percent of GDP by 2020.

- Entering international derivatives markets with diverse products.

- Setting up e-links between Saudi Stock Exchange (Tadawul) and international stock markets.

- Supporting private funds and venture capital funds.

- Deepening the market of investment funds and supporting diverse financing options.

- Setting up more endowment funds.

- Allocating more state-owned assets to brokerages.

- Allowing more qualified investors into Tadawul, in addition to enabling new types of players to enter the market.

- Encouraging private-sector companies to float shares in Tadawul.

The program encompasses other initiatives in areas spanning financial service digitization, data security, clearing systems, among others.