seeking an expedited path to inclusion within the major Stock indices. Given the NTP is seeking heavy involvement/investment from the private sector, we believe the measures introduced by the CMA to attract direct capital inflows to the country are likely linked with the larger NTP process. Growing confidence in the CMA’s market reforms and the potential for inclusion in the major indices could prove to be a meaningful basis for the market to rerate upwards. Taking positive steps to accelerate MSCI inclusion The Saudi Capital Markets Authority recently announced extensive changes to the Qualified Financial Investor (QFI) program, which should ultimately increase the ease of foreign access to the Saudi market. In particular: (1) Individual foreign investors will now be allowed to own up to 10% of the equity in a company (up from 5%). The total limit on foreign ownership remains at 49%. (2) CMA decreased the minimum AUM of QFls to US$1bn from USS5bn (although funds with AUM’s below this level will be considered by the CMA). (3) CMA introduced stock lending & covered short selling; (4) CMA extended the settlement cycle to T+2 from T+0, effectively eliminating pre- funding; (5) CMA effectively removed the concept of a QFI client, which would have prevented investors from using multiple fund managers to gain exposure to Saudi Arabia. This highly restrictive clause was a significant reason why many global institutions did not seek to gain QFI status; and (6) CMA significantly reduced the amount of bureaucracy required to apply for and retain QF status. MSCI inclusion one step closer as accessibility increases In our view, the range of measures the CMA is looking to adopt greatly enhances the accessibility of the Saudi Stock exchange and as such bring Saudi Arabia one step closer to inclusion in the MSCI EM index. Whilst we continue to see inclusion most likely from 2019 (with an announcement in 2018), the new changes indicate that a 2018 inclusi