Interview: Abdulla Mohammed Al Ansari, CEO, Qatar Stock Exchange (QSE), on fostering a more attractive market environment
What role do environmental, social and governance (ESG) considerations play in shaping investment strategies in Qatar’s capital markets?
ABDULLA MOHAMMED AL ANSARI: Sustainability remains an essential factor for financial markets, which are beginning to perceive ESG not as a matter of disclosure, but rather as a narrative on factors that are material to the competitive advantage of a business in a more sustainability-driven environment. The market is determining how capital is allocated when a sustainability lens is directed at any given investment. In Qatar, we are acutely aware of the impact of ESG on our market, whether via portfolio investment in equities or foreign direct investment. The Qatar Financial Markets Authority has agreed on the mandatory introduction of the International Sustainability Standards Board’s requirements for listed companies, and the Qatar Central Bank and the Qatar Financial Centre Regulatory Authority have similar plans. The QSE has invested in capacity building with listed companies for more than two years to ensure that they are well-prepared to meet ESG-related standards.
In what ways is technology improving efficiency in the trading landscape and Qatar’s capital markets?
AL ANSARI: Having robust, highly advanced technology is a prerequisite in modern capital markets. There is tremendous interest in adopting new technologies such as cloud, storage and computing, artificial intelligence and distributed ledger technology (DLT) because they can contribute to significant operational improvements. Cloud adoption, for example, is becoming mainstream for all participants. The industry estimates that nearly 50% of market participants use the cloud for non-core functions, and much of the remainder are working on pilot projects. DLT, which is crucially different from cryptocurrency, promises to be transformative, especially in post-trade market infrastructure. As a result, nearly all industry participants are involved in DLT development projects. There appear to be benefits to applying DLT to securities markets, especially in clearing and settlement. The implementation of a DLT system could help to eliminate a variety of repetitive business processes, simply because of the fewer intermediaries involved.
How is Qatar National Vision (QNV) 2030 impacting the development of the capital markets sector?
AL ANSARI: Shaped by the guiding principles of QNV 2030, the Third Financial Sector Strategic Plan, published in 2023, has a stated aim of creating financial and capital markets that lead the region in terms of innovation, efficiency and investor protection. It positions Qatar to unlock its full economic potential in line with QNV 2030, and the medium- and long-term macroeconomic picture looks very strong. The country has solid growth potential with a fiscal surplus and current account surplus that provide the government with significant economic flexibility and a corporate sector that is not burdened by high debt levels – all of which provide the backdrop to earnings’ recovery and growth.
To what extent will the introduction of the revised liquidity provider scheme boost the attractiveness of Qatar’s capital markets?
AL ANSARI: Liquidity schemes are well-established elements of the international capital markets and have proven benefits in terms of market efficiencies. The key is to design and implement programme parameters so that the strategies are viable for participants while also being beneficial to the market overall. The revised scheme is designed to foster a more dynamic and attractive market environment, which we hope will encourage greater participation and investment.
In terms of best practice, the interconnectedness of global markets means this is essential. If we seek to be open to global investors and market participants Qatar must adhere to international norms. However, we retain control of our own rules environment and are seeking to guarantee a level playing field for all participants.
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