EG-Finance Association; Arabs Unified Bourse Dream
On the sidelines of the Arab Federation For Financial Analysts (AFFA) conference, EG-Finance Association said there is an overwhelming consensus among those who work in capital market that the establishment of a unified Arab stock market is a sensible and positive idea.
“To have a unified Arab stock market is an effective and fruitful idea for the Arab countries as it will contribute towards speeding up economies promotion and towards resisting recession and stagnation impacts on the growth rates.” EG-Finance Association added
“It will also attract more foreign investments and restore the capital markets invested outside the Arab markets.”
EG-Finance Association added that the unified Arab stock market will also promote securities trading, support the idea of having an Arab Common Market, fuel boom in products as well as stocks and enhance investment performance and intra-trade levels.
However, the EG-Finance Association referred that studies on making a unified Arab stock market have shown an obvious discrepancy in whether this market will achieve success or not.
Some studies supported the idea of taking decisive steps in establishing the unified stock market saying that to have a coordination in the field of capital markets is much easier than to have in the field of commodities and employment process. These studies also added that establishing this market will boost cooperation between Arab countries in other fields besides capital markets. They also said taking decisive is now more crucial than before as most of the Arab countries had made multiple amendments in the field of capital mobility.
On the hand, other studies see that establishing a unified stock market is an inapplicable idea to be achieved adding that this step shall have been proceeded by launching the Arab Common Market taking the example of the Europe Union (EU) into consideration. These studies mentioned that there are many obstacles in the way of establishing this market. For instance, there are various laws ruling the Arab stock markets, each with its own regulations and trading systems. Hence, these studies recommended unifying those laws, regulations and systems first.
Furthermore, other obstacles would be represented in the different economic systems and structures as well as international and regional relations approach for each country.
There are also the problem of having dissimilar stock market experiences for each country as some countries such as Saudi Arabia does not permit foreign trading in its stock market.
Moreover, these studies tackled the fact that the Arab investors lack strong awareness of the various listing and trading rules required in the Arab bourses.
