Doha aims to achieve developed market status by developing a competitive and innovative capital market through deepening the financial offerings, including more equities as well as debt and ESG (environment, social and governance) bonds, according to the Qatar Central Bank (QCB).
The recently released third financial sector strategy seeks to develop a sustainable and efficient capital market operating model that is responsive to market requirements.
The QCB strategy aims to enhance the regulatory framework and rulebooks to reach developed market status for Qatari capital markets to attract wider audiences of domestic and international investors as part of efforts to enhance the share of transactions from institutional investors to the total.
The aim is to ensure that Qatar’s capital market leads the region in innovation and efficiency and drives national development by improving liquidity and velocity levels through enhanced regulatory framework, state-of-the art capital markets infrastructure, including electronic trading platforms and cloud computing facilities and ensuring data accessibility.
The financial sector strategy seeks to achieve the goals “through seven initiatives and 50 action items, including 23 priority ones.”
The QCB, in association with the Qatar Stock Exchange (QSE), is aiming to increase the liquidity and breadth of the capital markets through new listings and availability of new diverse financial products tailored for the needs of private sector, small and medium enterprises (SMEs) and institutional investors. These initiatives aim to increase the number of listings and increase the share of Shariah-compliant instruments on the bourse. Targeting more than QR8bn in total value of firms’ bonds issued in Qatar, the strategy aims to facilitate debt listings by expanding the fixed income market through the development of sukuk and bond products, green finance products and the strengthening of a yield curve.
These initiatives seek to enhance the value of listed fixed income in the QSE as a proportion of gross domestic product or GDP, increase the share of issued sukuks as well as green and ESG bonds as a percentage of total fixed income market, and grow the volume of issued bonds as a percentage of total fixed income market.
Targeting AuM (assets under management) growth of 18% to QR10bn, the QCB strategy aims to grow and institutionalise the asset management segment to improve capital deployment into the priority sectors, which ought to raise the number of licensed asset managers domiciled in Qatar.
On the asset management side, the QCB strategy highlighted the need for launching a competitive and comprehensive solutions (including for expats) and providing support for asset management regarding custody activities.
Another major initiative is to develop the derivatives market to further enhance depth and liquidity of the market.
