Ex-Shuaa chief urges more foreign ownership

Gulf companies should allow greater ownership by foreigners if they want to attract long-term institutional investors, according to the former chief executive of Shuaa Capital.

“I hope the GCC will be added to the MSCI emerging market index because that would bring in long-term funds and money from all those who have allocations to emerging markets, including endowments, universities and others,” said Iyad Duwaji, who stepped down as the chief executive of Shuaa last month after 17 years in the post. “Government support is essential in addressing some of the issues.” MSCI Barra, a compiler of stock indexes, classifies Gulf countries as frontier markets rather than emerging markets.

This affects demand for stocks from the region, because many institutional investors or asset managers who track MSCI indexes are restricted from investing in frontier markets. MSCI said in a statement that it “encourages the Emirati regulator to find ways to further facilitate equal foreign access to the local equity market”.