Karachi, December 24, 2024 – Mr. Khurram Schehzad, Advisor to Finance Minister, was invited to the Pakistan Stock Exchange (PSX) by CEO, PSX, Mr. Farrukh Sabzwari, to discuss strategies for enhancing the depth and performance of the capital market. During his meeting with the CEO and senior management of PSX, Mr. Schehzad received a comprehensive overview of PSX’s strategic initiatives aimed at unlocking potential of Pakistan’s capital markets.
The CEO of PSX emphasized that, despite challenges, Pakistan’s capital markets possess immense potential. He expressed confidence that through a well-formulated strategy, PSX could realize this potential and significantly contribute to the economy.
Mr. Schehzad reaffirmed the government’s commitment to supporting capital market growth, recognizing its role in stabilizing as well as underpinning growth in the country’s economy.
To achieve this goal, Mr. Schehzad urged the management to formalize recommendations for structural changes and privatization of State-Owned Enterprises (SOEs), which could advance governmental goals and boost market capitalization. Furthermore, he recommended rebranding and repositioning the GEM board to function as a platform for venture capital and startup fundraising.
The Key Initiatives planned and discussed include:
– High-Value Public Listings: Taking concrete steps for high-value listings to increase market capitalization and attract foreign investment.
– Expanding Investor Base: Setting an ambitious target to increase the investor base to 2% of the national population within three years, engaging brokers and mutual funds in the campaign.
– New Investment Products: Introduction of new investment products, such as Exchange-Traded Funds (ETFs), options markets, and derivatives, to enhance market attractiveness.
– Modern Trading Strategies: Exploring algorithmic trading and robo-advisory services, drawing insights from successful implementations in countries like China.
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Mr. Schehzad emphasized the need for the PSX and the SECP to collaboratively develop a roadmap aimed at increasing Pakistan’s weight within the MSCI Frontier Markets index, ultimately achieving inclusion in the MSCI Emerging Markets index. He also endorsed the recommendation to form a formal committee comprising PSX, SECP, and the State Bank of Pakistan (SBP) to leverage each entity’s strengths.
This initiative would aim to foster financial inclusion, enhance public awareness, and promote seamless digitization. Promoting the KSE-100 Index’s remarkable returns was identified as an essential task for brokers and market participants.
Mr. Schehzad praised the relaunch of cash-settled futures as a significant step towards developing the country’s derivatives market.
Collaboration with Chinese capital markets is critical to facilitate cross-border investment opportunities, broaden market access, and stimulate investor participation. With these initiatives, Pakistan’s capital market is poised for significant growth, driving economic development and stability.
