RIYADH, Sept 18 (Reuters) - The amendment to Saudi Arabia’s capital market law will allow other exchanges to be established alongside the government-owned Tadawul, the head of the Saudi Capital Market Authority (CMA) said on Wednesday.
“CMA plans to license other entities to provide activities of exchanges, depositories or clearing houses,” CMA Chairman Mohammed bin Abdullah Elkuwaiz told a conference.
Licensing new stock market operators would be a potential first step to privatising the bourse — the largest in the Middle East — as Riyadh moves to wean the economy off oil.
Financial website Maaal reported in July that the Shura Council, a top advisory body to the government, had submitted proposed new rules to the royal court for approval by the cabinet, citing unnamed sources.
Tadawul was opened to foreign investors in 2015 and the kingdom has introduced a raft of reforms to make its stock market more attractive to overseas buyers and issuers.
Local shares were incorporated into the FTSE emerging-market index in March and the MSCI emerging market benchmark in May this year, triggering increased fund flows into the stock markets. (Reporting by Marwa Rashad and Davide Barbuscia; Writing by Tuqa Khalid; Editing by Catherine Evans)