LONDON: Saudi Arabia became the top equity investment destination among emerging markets this summer according to the Institute of International Finance (IIF)
Supported by its upgrade to emerging market status, Saudi Arabia has attracted $18 billion in foreign equity inflows so far this year, the IIF said.
“The inclusion of local stocks to broad equity benchmarks acknowledges the progress made by Saudi Arabia in reforming its capital
market system,” the institute said in its latest report.
MSCI added Saudi stocks to its emerging markets index in June, while the index will complete the upgrade by the end of August.
“We expect the second phase of the upgrade to attract an additional $5 billion in equity inflows,” IIF said. While the ongoing trade war between the US and China negatively impacted investment flows to some emerging markets in recent months, Saudi Arabia bucked the overall bearish trend.
The Kingdom attracted more than $4.5 billion in foreign equity inflows in May, and $2 billion in the first three weeks of August, it said.
The inclusion of Tadawul-listed shares to both the MSCI and FTSE emerging market indexes has attracted billions of dollars from global investment funds this year.