The Kuwaiti stock market has yet to live up to its full potential with many public-private projects still to be completed and a number of potential IPOs in the pipeline, Minister of Commerce and Industry Khaled al-Roudhan said.
“We think we have the muscles, the know-how, and all the opportunity to become a commercial hub,” al-Roudhan said in an interview. “We’re trying to improve our business environment not only for foreigners but Kuwaitis too.”
Kuwait has taken some market-liberalisation measures that bring it closer to developed markets, al-Roudhan said. He cited the Capital Markets Authority’s “very ambitious development programme” focused on accessibility for foreign investors as well as the lack of foreign ownership limits.
The Capital Markets Authority will start a public offering of its 50% stake in Boursa Kuwait next month, making it the second publicly traded exchange in the Gulf after Dubai.
“This will enhance its profile further and increase its competitiveness,” according to al-Roudhan.
MSCI Inc will add Kuwait to its main index tracking stocks in emerging markets in June 2020, once some trading mechanisms are improved, in an upgrade that has been priced in by investors anticipating billions of dollars of inflows.
More high-profile listings can be gained by encouraging family businesses to list on the exchange as well as “speeding up the privatisation programme and PPP implementation, as many assets within those programs are candidates for listing,” al-Roudhan said.
Foreign investments of $1.5bn entered the bourse as a result of the capital market upgrading to the EM category in the FTSE index, the minister said. Approximately $2.5bn is expected after the official upgrade of MSCI.
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The Arab states of the Persian Gulf are the seven Arab states which border the Persian Gulf, namely Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE).This excludes the non-Arab state of Iran. All of these nations except Iraq are part of the Gulf Cooperation Council (GCC).