| “I wouldn’t advocate my government intervening in the market. You can’t use public funds to rescue the markets.” Rasheed Mohammed Al Maraj |
The Gulf’s economic fundamentals remain strong despite continued pressure on the region’s stock markets, according to a leading local policymaker. Rasheed Mohammed Al Maraj, governor of the Bahrain Monetary Agency, says that the region has undertaken substantial reform in recent years and this should stand it in good stead in the face of collapsing share prices on a number of local bourses.
Al Maraj says that the sell-off in the equity markets that began in March and has continued fiercely in some countries, most notably Saudi Arabia, was expected and was long overdue. “The valuation levels in most of the region’s markets were not realistic,” he says.
However, Al Maraj reckons the region’s underlying story remains favourable and that opportunities will arise for private investors. He says that economic reform, rather than the high oil price, is the most important reason for the region’s strong fundamentals. “People always put an emphasis on the high oil prices as part of the favourable outlook.