ADX Unveils its Five Years Strategic Plan ADX Strives to Achieve by pptfiles


									News Release – Business/Finance

ADX Unveils its Five Years Strategic Plan
ADX Strives to Achieve Excellence among Regional Stock Markets

Abu Dhabi, 21/5/2008: Abu Dhabi Securities Exchange announced its five years Strategic
Plan (2008-2012) under the slogan "Excellence among Regional Stock Markets" during a
press conference held yesterday at the Rotana Beach Hotel. Mr. Tom Healy, Chief Executive
of the exchange opened the conference by stating that “ADX strategic plan is aligned with
the vision of Abu Dhabi Government for a confident and secure society and an open, global
and sustainable economy”. Mr. Healy added that the strategic plan emphasizes ADX’s
commitment to transparency and high standards of governance, and involve the community
with the market’s effort to develop and improve. Mr. Healy also stated that the strategic plan
will be reviewed annually and amended when necessary to correlate with the continuing
changes in the business environment, and taking into consideration the needs of investors,
listed companies and brokers

According to Mr. Rashed Al Baloushi, Deputy Chief Executive, ADX aspires to become the
market of choice in the region. He explained that “achieving this vision requires achieving
two main objectives - increased contribution to growth and stability in a broader economy,
and credible enforcement of standards and market infrastructure that attract international
investors and strategic partners”.

Achieving the above objectives depends on the implementation of seven priorities as follows:
increasing institutional participation, enhancing the quality of market intermediation,
strengthening the equity market, providing infrastructure for a domestic debt market,
introducing new products, promoting the implementation of best practice regulatory
framework, and investing in social and physical infrastructure.

In addition, Mr. Al Baloushi mentioned that ADX strives to support the UAE as an
international economic center, be a representative of Abu Dhabi in global economic forums,
and be a leader among regional stock exchanges in mobilizing savings for investments.

Increasing Institutional participation

Increasing institutional participation in their market is one of ADX’s main priorities, in
promoting Abu Dhabi as a preferred destination for international investment. Mr. Al Baloushi
said that “one of the most important challenges in this area is to work with the regulator to
develop the regulatory framework in order to provide the infrastructure that attracts
institutional investments”. ADX completed a number of initiatives, including signing custodian
agreement with HSBC and National Bank of Abu Dhabi in order to encourage institutions to
invest in ADX.

Enhancing the quality of market intermediation

According to Mr.Al Baloushi, the second priority of enhancing the quality of market
intermediation highlights ADX’s focus on working with the financial intermediaries to help
investors make sound investment decisions. This priority also contributes to the stability of
the stock exchange through the brokerage companies’ provision of new services such as
financial analysis and market-making, as well as encouraging brokerage companies to apply
financial solvency regulations and develop a more sophisticated administrative structure. Mr
Al Baloushi added “several initiatives were completed by the market to achieve this priority
including posting brokerage companies’ violations on ADX website, organizing professional
mediation through the issuance of appropriate decisions and the coordination with the
Securities & Commodities Authority, and holding a variety of training programs for brokerage

Strengthening the equity market

Mr. Al Baloushi explained the importance of strengthening the equity market, which is the
main investment channel for local small investors. Thus, the development of the stock
market serves the interests of the UAE. ADX has embarked on many initiatives such as
encouraging listed public companies to implement corporate governance standards issued by
the Securities and Commodities Authority, an electronic link with Muscat Securities Market,
and signing memoranda of understandings with a number of regional and international stock
exchanges and depository institutions. Mr. Al Baloushi added that the average daily traded
value increased by 375.6% from AED 250 million in 2006 to around AED 1.2 billion in the
first quarter of 2008. Foreign investments increased by 77% from 14.9% in 2006 to 26.3%
in the first quarter of 2008.

Debt market and new products

Mr. Al Baloushi stated that the fourth priority is to provide for new methods to finance
projects, and the fifth priority aims to provide new investment products that contribute to
the diversification of investments and better risk management. He noted that “the main
challenge to achieving the fourth priority is to work with the Government to issue benchmark
bonds and create an active debt market, while the most important challenge for the fifth
priority is advising on the appropriate legislation to create and list new investment products”.
ADX is active with many initiatives, including working on the creation of Exchange Traded
Funds, signing memorandum of understandings with some international stock exchanges
which include the incorporation of Exchange Traded Funds. ADX also signed a strategic
partnership agreement with New York Stock Exchange Euronext. The agreement includes
establishing a market for derivatives.

Best practice regulatory framework

Mr. Al Baloushi said “the sixth priority of promoting the implementation of a best practice
regulatory framework is aligned with Abu Dhabi Government’s efforts to implement principles
of governance in the Abu Dhabi Departments and the economic development strategy
announced by the Ministry of Economy, which emphasized developing the legislative
system”. The main challenges for ADX and the regulator are to implement international best
practices, which will facilitate the growth of foreign investments and raise global awareness
of Abu Dhabi and the UAE. Among the initiatives carried out by ADX are adopting
International Financial Reporting Standards in the disclosure of the financial statements. ADX
submitted a number of legislative drafts to the competent authorities, including on, financial
solvency standards, and the listing of investment funds.

Mr. Al Baloushi pointed to the adage of His Highness Sheikh Khalifa bin Zayed Al Nahyan,
may God protect him, the President of the UAE "We must harness the full potential of the
state and its resources to building the active individual who is the cornerstone of the entire
national process". Since nationalizing the brokerage profession is important to the national
economy, ADX emphasizes investment in the social infrastructure. ADX contributed to the
SHARE program developed by the Securities and Commodities Authority through an
agreement to train students who participate in the program. The market also sponsored

several social activities, including contributing towards mass marriages for people with
special needs.

Mr. Al Baloushi said that “the strategic plan took shape after extensive studies and reviews of
international best practices”. He concluded by emphasizing the importance of the
participation of the private sector in achieving the vision and development of the stock

                                           - Ends-

For more information on ADX strategic plan, please contact:

Al-Anood Bin-Kalli
Tel.  00971 2 612 8 772
Fax   00971 2 612 8 728

About ADX:
The Abu Dhabi Securities Exchange (ADX) (formerly Abu Dhabi Securities Market) is a
leading stock exchange in the Gulf Region, and is well-respected internationally. ADX is
committed to market integrity and investor confidence, efficiency, fairness, and
transparency. It is continuously working to ensure the best interests of its listed companies
and investors, staying at the forefront of international best practices and services. ADX has a
wide investor base with 864,800 investors including 318,800 foreigners. For more
information about ADX please visit


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