Inclusion of MSCI & FTSE in Saudi Arabia Revised

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“To the lecturer and my fellow students good afternoon. I would like to take this opportunity to explain to you the post-MSCI & FTSE inclusion in Saudi Arabia.” The inclusion of MSCI and FTSE into a country is mainly accompanied by various results in the country’s economy. Saudi Arabia, just like any other country where MSCI and FTSE have been included will experience various impacts on economic development and prosperities. Foremost, the inclusion of the MSCI & FTSE in the country will affect the liquidity of the country.
Let me begin with the positive outcome that the country will experience from the MSCI & FTSE. Some of the positive impacts that are likely to be experienced after the inclusion of the MSCI & FTSE are remarkable capital inflow to the country. There will be an increase in the number of investors in Saudi Arabia. For instance, the inclusion of the MSCI will lead to a gain of $10 billion from the passive investors and $35 billion from the active investors while from the FTSE will lead to $5 billion from the investors. The inclusion of the MSCI & FTSE will result in the rise of the country’s index, and for that matter, it will help revive the future of the market. And also the trade volume of Saudi Arabia will as well rise. The fact that the MSCI & FTSE are global indices, their inclusion in the country’s market will create awareness to the investors concerning the country’s stock hence resulting in the higher trade volume.

On the contrary, there are long-term negative side effects or risks that will result from the inclusion of the MSCI & FTSE. Some of these risks include the weakening of the oil prices in the country hence causing interferences with the external balances and the geopolitical tension in the region. The inclusion can also result in the diversification of the long-term economic success of the country which the primary factor in the vision 2030 of Saudi Arabia.
I would like to summarize my presentation by saying; the impacts that will be experienced as a result of the introduction of the MSCI & FTSE are both positive and negative. However, the positive effects outweigh the negative one, and therefore, the MSCI & FTSE will bring many benefits to the Saudi Arabians in terms of their business development that before. Thank you for your time.