The Qatar Stock Exchange (QSE) is actively pursuing a strategy to lure investments from China, Hong Kong, Singapore and other Asian countries as part further diversifying its investor base, having put in place the required legislation, including a higher up to 49% foreign ownership limit (FOL).
In this regard, the QSE and Shanghai Stock Exchange are expected to enter into an agreement soon. This was disclosed by QSE chief executive Rashid bin Ali al-Mansoori while presenting Doha's investment climate scenario before Chinese asset managers and insurance companies, which are the long-term investors with deep financial pockets, at the recently held Shanghai Global Investment Forum.
After Qatar's upgrade to emerging market status by such international index compilers as MSCI, Standard & Poor's Dow Jones and FTSE Russell, the domestic stock market witnessed passive foreign funds inflow, but it was not that substantial in view of the restrictions on FOL at that time. Hence, through an Emiri decree, the FOLs were enhanced up to 49%, the move which ought to strengthen the international fund inflows.
Last year alone witnessed the Qatar Central Securities Depositary approve enhanced FOLs (to 49%) in Industries Qatar, Gulf International Services, Mesaieed Petrochemical Holding, Qatar Electricity and Water (QP subsidiaries), Qatar Islamic Bank, Barwa, Woqod, QNB and Qatari Investors Group.
Al-Mansoori met with the chairman of Shanghai Stock Exchange Huang Hongyuan along with senior officials from the Chinese bourse. Matters related to mutual co-operation and strategic developments were discussed during the meeting.
"The parties agreed to explore and identify mutually beneficial areas of co-operation to potentially sign a memorandum of understanding in the near future," a QSE spokesman said.
Qatar is already home to many Chinese companies, which are active in both hydrocarbons and non-hydrocarbons sectors in the country. Qatar Renminbi (RMB) Center, which is based in the Qatar Financial Center (QFC), is the first RMB clearing centre in the Middle East.
China, along with other Asian countries, is the largest trading partner of Qatar. The QFC is also home to some Chinese banks and financial institutions. The QFC had earlier said it was eyeing more financial and non-regulated firms from Asia and South East Asia, as part of its strategic move to tap the promising markets.