Qatar does not see much risk to domestic stock market from global volatility: QCB governor
Qatar does not expect much risk to the domestic stock market from global markets’ volatility, due to the country’s favourable macroeconomic fundamentals, said HE the Qatar Central Bank Governor Sheikh Abdullah bin Saoud al-Thani ( pictured). “We have been closely observing the global market conditions, especially after the trade tensions between the US and China. However, the domestic equity market so far remained insulated from the global developments,” he said in the context of the forthcoming Euromoney Qatar Conference 2018.
In fact, he noted, the Qatar stock exchange (QSE) registered the “strongest gain” in the GCC region during the year so far. The QSE index moved back to the pre-blockade level.
“Apart from the improvement in macroeconomic fundamentals, the rise in QSE is primarily driven by the foreign investors and their positive outlook of Qatar economy.
The tightening financial market conditions have mainly impacted those emerging market economies (EMEs), which are facing the problem of twin deficits (current account and fiscal position).
On whether Qatar’s plans to develop a “more liquid” market have evolved as the GCC capital flows are restricted, Sheikh Abdullah said, “The capital inflows to Qatar are more broad-based and are not restricted to the GCC region. Irrespective of all the developments in the GCC, Qatar will continue its efforts for the development of financial market by making it more liquid and encouraging global investors.”
Referring to the 10 years that followed the financial crisis of 2008, the QCB governor said, “Ten years since the financial crisis, global economy appeared to have moved out of the danger zone, even though downside risk still exists. Efforts by the central banks and other authorities across the globe enabled this positive development in the face of many uncertainties and risks.”
He said the global financial system has also strengthened, thanks to the financial reforms including Basel III capital and liquidity regulations. The crisis reinforced the importance of international co-ordination and harmonisation of strengthened regulations.
“Greater focus on the systemically important banks shows the change in approach of regulators and international standard setting bodies. Thus, the current approach of the regulators is providing higher focus on prevention of crisis.
“Overall, the global financial system is more resilient now, even though it is difficult to predict what can be the cause of future vulnerabilities,” Sheikh Abdullah said.
The two-day Euromoney Qatar Conference in Doha on December 9, 10 will focus on Qatar’s post-blockade strategy and its development as a sustainable economy.
The event at St Regis Doha is being held under the patronage of HE the Prime Minister and Minister of Interior, Sheikh Abdullah bin Nasser bin Khalifa al-Thani.
Co-hosted by the Qatar Central Bank, the conference’s keynote speakers include HE the Minister of Finance Ali Sherif al-Emadi, and the QCB governor.