Jeddah - King Abdullah has ordered a crackdown on
manipulation of Saudi Arabia’s booming stock market, insisting action should be
taken if necessary against improper trading by members of the royal family, the
daily Alsharq newspaper reported on Monday.
In an unusual message to the chairman of the Capital Market
Authority (CMA), the king said trading rules should be applied to everyone
including royals, the newspaper reported. The country's extended royal family
has thousands of members.
“With the current return of investors to the stock market,
there has been a return of some violations that require investigation and
accountability, requiring violators’ cases to be looked at by the specialised
legal authority,” the newspaper quoted the king as telling Abdulrahman
King Abdullah was also quoted as saying some of the
violations were being committed by members of the royal family, who had
continued their actions despite warnings, putting them in a position to be
investigated and even taken to court.
A spokesperson for the CMA declined to comment.
Saudi Arabia is a monarchy with no elected parliament, and
the most senior positions are occupied by high-ranking royals, some of whom
also have extensive business interests.
The country’s stock market has soared this year and trading
turnover has increased several-fold because of strong economic growth on the
back of high oil prices, hopes that authorities will open the market to direct
foreign investment, and an influx of speculative money.
The benchmark index is up 19% since the end of last year,
though it pulled back 1.8% on Sunday and continued sliding on Monday as word of
the Alsharq report reached investors, traders said.
The market, which is the largest bourse in the Arab world,
crashed in 2006, hurting tens of thousands of Saudis, many of whom blamed the
government for not protecting them from the clout of big investors.
The CMA subsequently imposed hefty fines on some violators
of trading rules. The government has become more anxious to preserve social
stability since last year’s Arab Spring uprisings in the Middle East, although
Saudi Arabia largely escaped serious unrest.