Reaffirming its commitment to the establishment of a more efficient, attractive, and globally competitive market that fulfills investor aspirations and adheres to international best practices, the Kuwaiti capital market apparatus has initiated the second part of the third phase of its comprehensive market development program (MD 3.2).
This phase encompasses a series of fundamental initiatives designed to fortify the operational and regulatory infrastructure, as well as to broaden the array of products and services available within the Kuwaiti capital market. Under the leadership of the Capital Markets Authority (CMA) and in collaboration with the Central Bank of Kuwait, local banks, investment firms, and brokerage companies, Boursa Kuwait and the Kuwait Clearing Company (KCC) have introduced a range of transformative products, services, and infrastructure enhancements. Notably, the implementation of the Central Counterparty (CCP) framework has been a significant advancement, as it mitigates risks and provides guarantees to enhance clearing and settlement processes in accordance with international standards.
Among the various enhancements implemented are cash settlements facilitated through local banks and the Central Bank of Kuwait’s KASSIP system; the elevation of brokerage firms’ operational frameworks to ‘Qualified Broker’ status, which signifies a substantial advancement in market structure; and the establishment of sub-account numbers within omnibus accounts, thereby bolstering transparency and oversight.
Furthermore, the technical environment and IT infrastructure have been meticulously prepared and upgraded, with extensive testing conducted in collaboration with all pertinent parties in anticipation of the listing and trading of Exchange-Traded Funds (ETFs) and fixed-income instruments, including bonds and sukuk. Legislative updates pertaining to these products are anticipated to be introduced in the near future.
This milestone signifies one of the most profound transformations in the history of the market since the privatization of Kuwait’s stock exchange. It is designed to reshape the regulatory and operational framework of the market, thereby paving the way for the introduction of new instruments and investment products that will enhance market liquidity, broaden its scope, and reinforce its role as a strategic catalyst for national economic growth.
In commenting on this significant achievement, Boursa Kuwait Chairman Bader Nasser Al-Kharafi emphasized that these developments constitute a crucial milestone in the ongoing progression of Kuwait’s capital market, thereby reinforcing its position and competitiveness on both regional and international fronts. He underscored that this accomplishment also exemplifies Boursa Kuwait’s unwavering commitment to advancing the State’s ambitious vision of establishing Kuwait as a premier regional financial center that attracts investment. This endeavor is pursued in close collaboration with all stakeholders to implement a comprehensive strategic roadmap aimed at accelerating market development and enhancing its contribution to national economic growth.
“We hold in high regard the remarkable efforts that have propelled the various phases of the Market Development Program for Kuwait’s capital market, which reflect the efficacy of constructive cooperation between the public and private sectors. This collaboration serves as a national model for achieving economic objectives and developmental aspirations rooted in innovation and professionalism,” stated Al-Kharafi.
He further noted, “This partnership has been instrumental in enhancing market infrastructure and introducing sophisticated products and services that foster a more transparent and dynamic investment environment. Such efforts are vital for attracting capital, generating added value for the national economy, and supporting the diversification of income sources.”
In conclusion, Al-Kharafi expressed his heartfelt gratitude to all parties involved in this achievement, stating, “I wish to convey my profound appreciation to the Central Bank of Kuwait, the Capital Markets Authority, and Kuwait Clearing Company for their unwavering support, which has been pivotal in fortifying market stability and enhancing standards of transparency and governance. I also commend the collaboration of our partners in the financial sector, who remain a cornerstone in the ongoing development of Kuwait’s capital market.”
