CMA: No major rules changes needed for Aramco IPO

Saudi Aramco is targeting 2018 for what is expected to be the world’s biggest initial public offering.
Updated 07 December 2016
0

CMA: No major rules changes needed for Aramco IPO

RIYADH: Saudi Aramco’s planned flotation is unlikely to require any major changes to Saudi Arabia’s securities rules, said Abdullah Elkuwaiz, vice chairman of the Capital Market Authority.
Saudi Aramco is targeting 2018 for what is expected to be the world’s biggest initial public offering, with a listing at home and overseas among the options.
Saudi Arabia’s ambitious Vision 2030 plan to diversify away from oil includes greater private sector involvement and improving the efficiency of state-owned companies.
Should a dual listing happen, some work might be needed involving the management of shares between two markets, such as the mechanics on the sharing of information on trades, the vice chairman told reporters on the sidelines of a conference on Tuesday.
Saudi Arabia has never before had a dual listing involving a company listed on its bourse, which is known as the Tadawul.
“If there is a decision to list in another exchange, whether it is Aramco or any other company, there would be something that will need to be done, but most of this is more on the operations side not the regulatory side,” he said.
Ultimately it will depend on the structure which Aramco decides to employ on its listing, but from what the CMA is anticipating there would be no need for additional rule changes, Elkuwaiz added.
The CMA has made changes to existing regulations in recent months and introduced new initiatives aimed at developing the market and securing inclusion in global indices such as MSCI which are shadowed by international investors.
Among these are the gradual opening up to foreign capital — the latest incarnation coming into force at the beginning of September — and a switch to settlement of trades within two working days, which is on track for the first half of 2017, Elkuwaiz said.
A market for small and medium-sized businesses, announced in April and expected to go live in early 2017, had received close to 10 applications even though the draft rules had not been approved yet, he added.
Elkuwaiz, who is heading the regulator after Mohammed Al-Jadaan was named finance minister on Oct. 31, said it was unclear when a new CMA chairman will be appointed.
An unintended consequence of the settlements change and the SME market launch would be that plans for a prime section of the Tadawul — a new index which would contain top blue-chip stocks — would likely be delayed, Elkuwaiz said.
A new corporate governance law containing additional measures to protect shareholders was also close to being announced and may be used to judge which companies qualify for the prime index, he added.


Mideast plays key role in Chinese export of armed drones, report says

Updated 17 December 2018
0

Mideast plays key role in Chinese export of armed drones, report says

  • China has exploited America’s selective drone export policy to become an increasingly influential player in meeting demand
  • The report is entitled “Armed Drones in the Middle East: Proliferation and Norms in the Region”

BEIRUT: The use of armed drones in the Middle East, driven largely by sales from China, has grown significantly in the past few years with an increasing number of countries and other parties using them in regional conflicts to lethal effects, a new report said Monday.
The report by the Royal United Services Institute, or RUSI, found that more and more Mideast countries have acquired armed drones, either by importing them, such as Jordan, Iraq, Saudi Arabia and the United Arab Emirates, or by building them domestically like Israel, Iran and Turkey.
China has won sales in the Middle East and elsewhere by offering drones — otherwise known as UAVs or unmanned aerial vehicles — at lower prices and without the political conditions attached by the United States.
The report , entitled “Armed Drones in the Middle East: Proliferation and Norms in the Region,” said that by capitalizing on the gap in the market over the past few years, Beijing has supplied armed drones to several countries that are not authorized to purchase them from the US, and at a dramatically cheaper price.
“China, a no-questions-asked exporter of drones, has played and is likely to continue playing a key role as a supplier of armed UAVs to the Middle East,” it said.
The report explored where and how each of the states have used their armed drones and whether they have changed the way these countries approach air power. It found that Iran, the UAE and Turkey all changed the way they employ airpower after they acquired armed drones.
For Turkey and the UAE, armed drones enabled them to conduct strikes in situations where they would not have risked using conventional aircraft, it said. Iran developed armed drones from the outset specifically to enable to project power beyond the reach of its air force, which is hamstrung by obsolete aircraft and sanctions, the report added.
The report said it remains to be seen whether and how the loosening of restrictions on the exportation of armed drones by the Trump administration will alter dynamics in the region.
“Nonetheless, proliferation in armed UAVs in the Middle East is unlikely to stop and could, in fact, even accelerate,” the report said.