SAUDI STOCK EXCHANGE NAMED TO WATCH LIST FOR MSCI EMERGING MARKET INDEX

Addition to Watch List affirms positive impact of market reforms Tadawul and Saudi government have introduced as part of Vision 2030 The Exchange commits to continue strengthening the Saudi market as it eyes 2018 for potential Index inclusion


LONDON, June 20, 2017 /PRNewswire/ -- The Saudi Stock Exchange (Tadawul) is pleased to announce today that it has been named by MSCI to the organization's Emerging Market Index Watch List. The announcement comes on the heels of a series of market reforms that Tadawul and the Capital Market Authority (CMA) have undertaken as part of the Kingdom of Saudi Arabia's Vision 2030 economic transformation program, which in part seeks to bring the Saudi market into alignment with its emerging and developed market peers and gain recognition for the country as an indexed emerging market.

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"Saudi Arabia's addition to the MSCI Watch List is an important milestone for Tadawul, and reflects the Kingdom's significant progress in capital market reform in support of Vision 2030," said Sarah Al Suhaimi, Chairperson of Tadawul. "Potential inclusion in MSCI's Emerging Market Index signals to international investors that the country's capital market has attained greater maturity in terms of efficiency, governance and regulatory framework."

The Kingdom's addition to the Watch List and anticipated inclusion in the MSCI Emerging Market Index will ultimately make Tadawul, its constituent listed companies and investors who trade on it, benefit from what is anticipated to be a greater allocation of weighting of global emerging market funds to the Exchange. Overall, growth in emerging markets globally is expected by the International Monetary Fund to improve for the second consecutive year, rising to a projected 4.5 percent in 2017, compared to 4 and 4.1 percent in 2015 and 2016 respectively.[1]

Over the past year, Tadawul has worked closely with Saudi government bodies and leading emerging market investors to introduce Vision 2030 capital market reforms, and these have in turn helped move the needle further on achieving Watch List status. Key reforms to date have, among others, included: "Today's announcement from MSCI is an immense achievement for Tadawul and the Saudi market. However, it is still just another stepping stone toward gaining full Index inclusion," said Khalid Al Hussan, Chief Executive Officer of Tadawul. "We must continue to make efforts to further strengthen the market through reforms and build investor confidence so that we may maximize our position in 2018 to be formally listed alongside other global markets in MSCI's Emerging Market Index."

Continued Al Hussan: "With anticipated MSCI index inclusion now one step closer and a number of other favorable dynamics taking place in the Saudi market, Saudi Arabia's ongoing economic transformation through diversification and privatization and favorable demographics for sustainable growth makes it a uniquely attractive emerging market."

Saudi Arabia, which opened its market to international investors in June 2015 through its Qualified Foreign Investor (QFI) program, has to date registered more than $ 5.48 billion worth of investable assets. The value of QFI holdings increased more than 3.5 times during Q1 of 2017, while value traded on the Exchange increased by 19.9 percent month-over-month in May 2017.

For more information on today's announcement from MSCI click here.

About Tadawul

The Saudi Stock Exchange (Tadawul) is the sole entity authorized in the Kingdom of Saudi Arabia to act as the kingdom's securities exchange (the Exchange), listing and trading in securities. The Saudi stock market is the 23rd largest stock market among the 64 members of the World Federation of Exchanges and is the dominant market in the Gulf Cooperation Council (GCC) comprising 42 percent of total GCC market capitalization and 81 percent of value traded. The Exchange is the tenth largest stock market amongst its emerging market peers. For more information on Tadawul please visit http://www.tadawul.com.sa.

1. Available at: http://www.imf.org/en/Publications/WEO/Issues/2016/12/27/A-Shifting-Global-Economic-Landscape

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