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Increased investments in new projects related to expansion of liquefied natural gas (LNG) and those aimed at ensuring self-sufficiency as well as higher foreign ownership limits (FOLs) augur well for the Qatar Stock Exchange (QSE), which is now seeking to diversify investor base.
The strategy was disclosed by the QSE chief executive Rashid bin Ali al-Mansoori-led delegation at the London Investors Forum which was organised in association with leading investment bank Deutsche Bank and QNB Financial Services (QNBFS).
“Despite challenges we believe the macro picture for Qatar remains resilient with the market experts forecasting increased GDP (gross domestic product) forecasts for 2018 taking into account the impact of increased forecast oil prices; an expectation of a sharper rebound in hydrocarbon output and an expectation of a reduced economic impact of the blockade on 2018 GDP,” he told the forum that was attended by the world’s largest international fund managers.
In the longer term, Qatar’s economy should benefit from a number of recent measures including increased investment in new projects related to the expansion of LNG production and projects aimed at ensuring self-sufficiency and sustainability, he said.
Lifting the moratorium on the North Field, Qatar had last year said it was expanding liquefied natural gas output by 30% to 100Mta. Whilst QSE has been a member of key global indices, such as MSCI and FTSE Russell, since 2014, it continues to place emphasis on the importance of an ongoing improvement in transparency and ease of access for foreign investors. Qatar’s recent announcement of a number of key listed companies increasing their FOLs up to 49% is part of the ongoing commitment.
The listed companies met with market-leading institutions that represented the most important funds allocating money to Qatar, Gulf and the broader emerging markets. Eight listed corporates, representing blue-chip investment opportunities in the Qatari market used the opportunity to meet with the world’s leading fund managers.
The participating companies were QNB, Doha Bank, Commercial Bank, Masraf Al Rayan, Ooredoo, Industries Qatar (also covering Gulf International Services and Mesaieed Petrochemical Holding), Qatar Islamic Bank and Qatar Electricity and Water.
“In addition to the critical listed company meetings, QSE has also taken the opportunity to continue direct ongoing dialogue with stakeholders in our market including international brokers and fund managers,” al-Mansoori said.
Quoting a QNBFS study, Abdul Aziz al-Emadi, Director, Listing Department said the increased FOLs will result in material inflows as part of the MSCI and FTSE rebalancing, which could drive about QR7bn in passive funds into these QSE-listed names.
“We believe the commitment of investors to our market is evidenced by the rally in Qatar, with the All-Share Index up 12% to May 1 after nine issuers including, for example, participating companies QNB, Industries Qatar, Qatar Islamic Bank and Qatar Electricity and Water announced an increase in their FOLs,” he said.
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