Arab investors urged to change attitudes to regional security markets
Lebanese officials called on Arab investors to change their attitude toward investments in the region’s security markets, where they said trading is minuscule compared to stock exchanges in the United States, Europe and the emerging markets in Asia and Central Europe.
Speaking at a three-day banking conference organized by the Union of Arab Banks, Fadi Khalaf, the chairman of the Beirut Stock Exchange, said that perceptions need to be altered. “We need to change the false impression of the Arab citizen, who still thinks that investment risk is a sort of gambling in the casino,” he said, as quoted in the Daily Star.
The risks in the capital markets are far less than the risks of direct investments such as commerce and trading,” Khalaf added.
Khalaf also referred to excessively low number of companies that choose to have their shares publicly traded. He insisted that companies in the Arab world would improve their chances of survival if they listed shares on a bourse.
To allay investors’ concerns, Khalaf said, the Arab countries should legislate investment laws that would make their capital markets more competitive. He recommended the creation of supervisory bodies, and the provision of tax incentives to listed companies.
Also addressing the conference was Riad Salameh, the governor of Lebanon’s central bank. Noting that the Arab capital markets were only attracting 10 percent of the funds that are headed to other emerging markets, he called on the Arab states to allow the free and unrestricted transfer of capital and funds, and to remove all bureaucratic barriers. – (Albawaba-MEBG)