RIYADH: Saudi Arabia’s bourse said on Monday it plans a market for small and medium enterprises (SMEs) next year, under a push for SME development in a restructured economy.
“This initiative comes in view of the importance of the role of this segment in supporting the national economy and accelerating development,” the Tadawul bourse said in a statement.
It “will establish a stock market segment targeting small and medium companies by the beginning of 2017,” enabling them to finance their activities.
The exchange, the Arab world’s largest, for the first time last year allowed foreign banks, brokerage houses, fund managers and insurance companies to invest directly on the Tadawul All-Shares Index, provided they meet the requirements.
The global collapse in oil prices over the past two years has intensified efforts by the world’s biggest oil exporter to find economic alternatives to its main revenue source.
Among these is a push to promote SMEs.
Saudi Arabia is to announce next Monday its “vision” for future social and economic development, Deputy Crown Prince Mohammed bin Salman told Bloomberg News.
Part of that plan, the National Transformation Program, will be unveiled in subsequent weeks, to detail the economic changes in a country that still relies on oil for more than 70 percent of its revenue.
Oil prices have fallen by more than half from above $100 a barrel in early 2014 to around $40 on Monday.
Projecting a deficit of $87 billion this year, the government raised retail fuel prices by up to 80 percent in December and cut subsidies for electricity, water and other services.
It has also delayed some major projects and mooted privatizations and imposing taxes. AFP