Kuwaiti stocks end week more than 2 percent higher
The Kuwait Stock Exchange (KSE) closed the week Wednesday up 2.2 percent, buoyed by government promises allowing foreign ownership of stocks.
The KSE index closed at 1,381.5 points, 30.2 points higher than one week ago.
However, the finish was 4.2 percent lower than that at the end of 1999 and down 51.3 percent on the index's all-time high in November 1997.
After surging 37.6 points on Tuesday, the KSE lost 11.3 points on the last day of trading in the week, mainly on profit-taking but also because of unclear government measures on the bad debt law, brokers said.
The foreign minister, Sheikh Sabah al-Ahmad al-Sabah, who has been taking charge of the economic issues, Tuesday promised the chamber of commerce and industry to relax repayment terms of the bad debt law. But no clear-cut measures were announced as a ministerial panel was asked to draw up new terms without changing the law.
The bad debt law stipulates methods by which hundreds of debtors, mostly big businessmen, can repay some 20 billion dollars in bad debt to local commercial banks. The debt was purchased by the government in 1992 by issuing treasury bonds.
Although the law lets debtors off more than 55 percent of the original debt without interest, influential debtors have been pressing for more government concessions amid opposition from MPs.
The government's nod to regulations of a bill allowing foreign ownership of Kuwaiti stocks, however, did stimulate the KSE. The bill allows foreign investors and expatriates living in Kuwait to own up to 100 percent of the stock of Kuwaiti companies listed on the stock exchange other than banks, where ownership will be limited to 49 percent.
Based on regulations released Tuesday, ownership in banks could still exceed that percentage if approval is granted by the cabinet on the recommendation of the central bank.
Some 87 companies with market capitalization of about 20 billion dollars are listed on the KSE, the second largest bourse in the Arab world after the NCFEI in Saudi Arabia.
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)