Capital market critical for QNV 2030 takeoff

December 13, 2012 - 7:56:55 am

From left: Rym Ayadi, Sami Boujelben, and Emad Mansour at a panel discussion on the final day of Euromoney Qatar Conference yesterday. (Abdul Basit)

DOHA: Qatar’s capital market has to be equipped to be capable of playing key role in realising the country’s ambitious national vision, Qatar National Vision 2030. A huge share of fund that Qatar requires to carry out its vision has to be arranged from this sector, experts said.

Attending two different panel discussions at the “Euromoney Qatar Conference” which ended here yesterday, the financial experts noted   it is economically wise to raise the money needed for the funding of QNV2030 through debts and equities. Bolstering  Qatar’s  ‘under developed’ capital market is  key for this, they said.

“Development of a strong financial market is key for the realization of Qatar National Vision 2030. The vision document cannot be seen isolated from the capital market. If we look at Qatar’s security market, it is quite under developed. There is huge possibility of  making this sector as a one of the potential tool to realise Qatar’s ambitious national vision 2030,” said Rym Ayadi, senior research fellow and head of research, Financial Institutions, Prudential Policy and Tax Unit, Centre for European Policy Studies.

Rym said Qatar’s newly enacted law to regulate the financial sector is in the right direction and can be seen as the first step to strengthen the country’s capital market.

Nadeem Mujtaba, Managing Director, The Directors Counsel said Qatar’s capital market is relatively naïve.  If you compare the Qatari market with matured economies, there is a significant gap.  We need to make sure   Qatar’s financial market is capable of attracting international funds.

Participating in a panel discussion on “The role of finance in Qatar’s vision 2030”another expert said: QNV 2030 is a strategic document in terms of Qatar’s long-term development. Qatar has already announced investing over $100bn in short-term. Thirty percent of this fund is supposed to be raised through equity and 70 percent through debt. Qatar’s financial sector will certainly need to partner with the international banks to raise the required fund.” 

The capital market can play a significant role in raising the fund. Islamic Bond has great opportunities. More banks from the regions are coming to take part in the  sukuk issuance, said Syed Hassan, general manager, Wholesale Banking Group, Masraf Al Rayan.

The QNV2030 means huge money. Banks are just one channel. Capital market can really play a much bigger role in arranging the fund, said Emad Mansour, Chief Executive Office, Qatar First Investment Bank said:

A country with an estimated 23 percent budget surplus does not necessarily go for issuing debt to raise the money. But ideally, it is  wise to diversify the revenue and go for debt to  bridge the funding gap..  Capital markets across the matured economies use T Bills and government papers to bridge the gap.

Sami Boujelben, Chief Adviser, Chief Executive’s Office and Acting Director, Securities and Issuers Affairs, Qatar Financial Markets Authority said  the new law is a significant step to meet the expectations of a strong capital market. Qatar will see more IPOs in 2013, he said.

The Peninsula