(MENAFN - Gulf Times) Small and medium enterprises (SMEs) in the Gulf region including Qatar will soon be able to tap Doha 's equity market with the Qatar Exchange (QE) putting in place the required technical and regulatory infrastructure for the junior bourse.
"The market is now ready in terms of technical and regulatory aspects and able to receive listing applications to be submitted by business owners from Qatar and the GCC (Gulf Co-operation Council) countries and to inform them about the listing criteria and trading rules thereon," a QE spokesman said.
This initiative will be undertaken in co-operation with various Qatari entities such as the Qatar Development Bank, Silatech and Qatar Enterprise, pursuant to the directives of the Supreme Council for Economic Affairs and Investment. The move is aimed at developing the financial markets in Qatar through providing a dedicated route for SME sector, a key element of the 'Qatar National Vision 2030'.
SMEs are playing a pivotal role in the performance of developing economies and developed countries alike as many countries attempt to establish niche markets for listing SMEs and trading their equity shares in order to attract domestic and foreign investments and create a momentum in this vital sector, the spokesman said.
To inform the public of the advantages of establishing this market, the QE will hold a workshop on January 25 where finer details would be provided to banks, brokers, law firms, consultants, private equity firms and other advisors, who will play a key role in the listing process.
The listing criteria for SMEs would be different from the currently-applicable requirements for listing companies in the main market, the spokesman had last year said.
The establishment of a junior market would give SME owners the opportunity to be listed on the bourse in accordance with lighter and flexible regulations, in addition to giving them further finance sources to grow their businesses, he had said. SMEs - which tend to show a far more volatile pattern of growth and earnings with greater fluctuations than larger companies - face a plethora of challenges, which includes limited access to capital, mainly due to the lack of credit ratings.
In view of the financing gap, QDB, in association with other commercial lenders in the country, has already initiated steps to ensure credit flow to the SME sector.
The Supreme Council for Economic Affairs and Investment, headed by HH the Emir Sheikh Hamad bin Khalifa al-Thani in a meeting on May 25 last year, decided to create a junior bourse, which would contribute to developing SMEs and increasing their efficiency so that they will be able to occupy advanced positions regionally and internationally.