Middle East 'NASDAQ' set to open next year

Bahrain, Jordan and Dubai are working together to create a 'NASDAQ of the Middle East' stock exchange for tech-focused companies throughout the region.

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By  Rob Corder Published  June 3, 2001

Bahrain, Jordan and Dubai are working together to create a single online stock exchange for tech-focused companies in the Middle East.

The ‘NASDAQ of the Middle East’ should be online “sometime next year,” according to Jassim Karim Salman, IT head, Bahrain Stock Exchange, and project leader for IT integration of the new exchange. While the initiative is being driven by Dubai, Jordan and Bahrain, companies from across the Arab world will be invited to list on the exchange.

With at least 12 months until the launch, details are still scarce on how the exchange will operate. Salman hinted that the entire market would be online via a portal supported by financial information and brokerage services for listed companies.

Offering brokers and private investors with a full service is essential, argues Salman, in order to attract investment. “What is happening at the moment is that we are losing a lot of investment money from the Middle East to the US and Europe. The reason for this is that [an investor] can get every bit of detail about a company online; they can open a trading account online; they can do all the buying and selling online in a secure environment. There is a lot of flight of capital not just because of the stocks, but because the [international] portals are offering a huge amount of information online and in real time. This gives people confidence in making decisions,” he added.

A brand new exchange and supporting portal for listing tech-focused small cap players in the Middle East could break through existing barriers to successful local stock markets. The new exchange, for example, will have its own set of regulations that adhere to international standards and are not constrained by the existing legal frameworks of Middle East countries. “You can’t really hope to attract foreign investment if you give people a set of rules that are alien to them. People are used to regulations like those laid down by the SEC,” explained Salman.

If successful, the Middle East exchange will give small tech-focused companies access to international capital in a way that has never been possible before. “This is an attempt to give the local IT industry an identity of its own. It is our bid to give the public the opportunity to show their confidence in the regional IT players; to inject capital in them to enable them to compete and establish a presence in the global market,” concluded Salman.

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