RIYADH — Mohammed Al-Quwaiz, vice chairman of the Saudi Capital Market Authority (CMA), underscored the importance of Sukuk (Islamic bond) and debt instruments for investors as these options enable them to diversify their investments at different levels of risks and turnover. He made the remarks during the opening of Sukuk Conference with the theme of “Sukuk Market: Challenges and opportunities” in Riyadh on Tuesday.
The two-day event was organized by CMA in collaboration with the World Bank, the Saudi Press Agency reported.
The conference is discussing the role of debt markets in supporting the economic growth through its five sessions. Government officials and representatives from the World Bank and the private sector as well as economists and financial partners in the capital market are participating in the conference.
Al-Quwaiz noted that Sukuk and debt markets represent important options to provide funding for various projects and facilities. Though the Kingdom has launched debt capital market in 2009, he said, still the size of this market is relatively small, particularly when compared with those in emerging markets or with bank funding or the size of the stock markets. “The CMA has attached great importance to the development of the Sukuk market through a number of initiatives that contribute to the support and development of this market in CMA strategic plan for the period of 2015-2019.”
Al-Quwaiz said that the activation of Sukuk and debt capital markets depends on a number of elements, and success components involving CMA and others, and that require cooperation and understanding among the concerned parties.
The conference is discussing the challenges facing the Sukuk markets in Saudi Arabia in particular, and in the GCC states in general, as well as the mechanisms and ways to develop capital markets in the region, to reflect the development of debt markets so that they are able to provide the necessary finance to both the private and public sectors.
The conference, through its five sessions, covers the elements of Sukuk markets, the dynamics of Sukuk markets, ways to create an effective environment for Sukuk market, regulatory issues and corporate governance in Sukuk market, and the role of debt markets in economic growth. The conference aims to achieve its strategic objectives which include deepening the capital market and encouraging the issuance of debt instruments, in addition to promoting the economic development of Kingdom’s Vision 2030. — SG